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Graham Jones (Hyndburn) (Lab)
1. What recent discussions he has had with the Secretary of State for Justice on proposals for reform of the Human Rights Act 1998.
Paul Blomfield (Sheffield Central) (Lab)
2. What steps he plans to take to ensure that proposals for reform of the Human Rights Act 1998 meet the UK’s domestic and international human rights obligations.
The Attorney General (Jeremy Wright)
The Justice Secretary and I meet regularly to discuss important issues of common interest, including on domestic and international human rights law. I am not, as the House knows, able to talk about any legal content of those discussions, because, by convention, whether the Law Officers have given advice or not is not disclosed outside government.
Graham Jones
The public need to be aware that withdrawing from the Human Rights Act does not mean that we will withdraw from human rights, because people will still be able to have those rights. It is just that rather than get them in British courts they will have to traipse off to Strasbourg to get them. The British public need to be made aware of the situation. The issue, of course, is about the convention. Are the Government proposing to withdraw from the European convention on human rights, a move that would remove human rights in this country, rather than just from the Human Rights Act?
The Attorney General
The hon. Gentleman is right to a certain extent, but of course he will have to wait for the proposals that the Justice Secretary will make on human rights reform. The other point for the hon. Gentleman to bear in mind is that it is not just the Court in Strasbourg that protects the human rights of British citizens. The British courts do, too, and I believe we can rely on the robustness and good sense of British judges to protect those rights.
Paul Blomfield
Because so many people in my constituency had written to me expressing their concerns about the Government’s plans on this issue, I organised a meeting during the recess. The dozens of people who came along had one simple question, which I hope the Attorney General will be able to answer: which of the rights currently contained within the Human Rights Act would he and the Government wish to see excluded from a British Bill of Rights?
The Attorney General
Again, as the hon. Gentleman has heard me say, he will have to wait for the precise proposals we are going to make. It is worth pointing out that the rights he is talking about are found not in the Human Rights Act, but in the European convention on human rights. The Government have made it clear, as I have on previous occasions, that we do not object to the content of the convention—we object to the way it is interpreted.
Robert Neill (Bromley and Chislehurst) (Con)
One important issue in terms of the credibility of the European Court of Human Rights is the quality of the judges. We are shortly to appoint a new British judge, so can the Attorney General assure us that we will ensure that we have a judge of the very highest quality appointed? Unfortunately, the quality some of the appointments from other jurisdictions, not ours, have in the past caused concerns to the Parliamentary Assembly of the Council of Europe.
The Attorney General
My hon. Friend is entirely right that the quality of the judiciary matters hugely, in Strasbourg and elsewhere. As he has heard me say, we share confidence in the quality of the British judiciary, and I hope very much that one of those excellent judges will be prepared to serve in Strasbourg so that our point of view can be clearly represented.
Mr David Nuttall (Bury North) (Con)
Does the Attorney General agree that the most convincing argument as to why this Government must press ahead with this move as quickly as possible is set out on page 60 of the Conservative party manifesto? It states:
“The next Conservative Government will scrap the Human Rights Act, and introduce a British Bill of Rights.”
Some 11.3 million people voted for that and they will expect it to be carried out quickly.
The Attorney General
My hon. Friend will know that I share his enthusiasm for this reform, and I stood on that manifesto, too, and believe in it. But it is important also to make sure that we get this reform right and that we have the details worked out before we announce what we wish to do. There will of course also be an opportunity for all Members of this House to comment on what is proposed, because I know that the Justice Secretary intends to consult on the matter.
Richard Arkless (Dumfries and Galloway) (SNP)
The proposed repeal of the Human Rights Act and the potential withdrawal from the ECHR has serious constitutional implications for Scotland. Has the Attorney General seen the proposals and will he be delivering legal advice before they are published in the public domain?
The Attorney General
As the hon. Gentleman has heard me say to the Select Committee, I would certainly expect to see the proposals before they are published. He is right, of course, that the devolution consequences of any changes that might be made are significant or potentially significant, depending on what is done. I am afraid that, until we see what is proposed, it is difficult to assess exactly what those consequences might be.
Mr Philip Hollobone (Kettering) (Con)
When my constituents say, “Philip, we voted Conservative because we wanted to get rid of the Human Rights Act, when is it going to happen?” what should I tell them?
The Attorney General
My hon. Friend can tell his constituents, as we should all tell our constituents, that manifesto promises matter, and this Government intend to honour their manifesto. Of course, a manifesto does not all have to be delivered in the first six months of government. We will seek to do so as soon as possible. I know that the Justice Secretary and his colleagues are working very hard on bringing forward proposals.
Nick Thomas-Symonds (Torfaen) (Lab)
Does the Attorney General accept that the continuing uncertainty about whether the UK will remain a signatory to the ECHR is itself damaging? Given that the proposal for a British Bill of Rights has been around in the Conservative party for a considerable time, why cannot the Attorney General be certain and tell us whether the UK will remain a signatory to the ECHR or not?
The Attorney General
I do not accept that that uncertainty is damaging. What is happening is that we are seeking a better settlement on the arrangements at Strasbourg. We believe that, on issues such as prisoner voting, it is important that this House, not the Court in Strasbourg, should make the decision. That requires a discussion with the Council of Europe. That discussion will take place. It is important that we on the Conservative Benches at least say that the status quo is unacceptable and that we need to do something about it. If the Opposition believe that the status quo is acceptable, they should make that clear.
Karl Turner (Kingston upon Hull East) (Lab)
What’s wrong with the Act, Jeremy?
Mr Speaker
Order. The hon. Member for Kingston upon Hull East (Karl Turner) is something of a veteran at chuntering from a sedentary position in evident disapproval of the thrust of the Government Front-Bench team’s position, but he will have his opportunity, on his feet, in due course.
Karen Lumley (Redditch) (Con)
4. What steps the Crown Prosecution Service has taken to improve the conviction rate for rape and domestic violence in the last two years.
Karl MᶜCartney (Lincoln) (Con)
8. What steps the Crown Prosecution Service has taken to improve the conviction rate for rape and domestic violence in the last two years.
The Solicitor General (Robert Buckland)
This year, more cases of violence against women and girls have been referred from the police, charged, prosecuted and convicted than ever before. The work undertaken by the Crown Prosecution Service and the police on rape and domestic abuse culminated in the highest volumes ever of prosecutions and convictions in 2014-15.
Karen Lumley
In the West Mercia region, in which my constituency is located, we have seen the rape crisis go up this year to 700 from 400 cases. Can my hon. and learned Friend assure me that we are doing everything we can to make sure that these people are prosecuted?
The Solicitor General
CPS West Midlands has a specialist rape and serious sexual offences unit in recognition of the increasing volume of rape and serious sexual offences reported. CPS West Midlands has increased the size of the unit and the team continues to work very closely with the police, victims groups and the independent Bar to ensure that strong cases are built and witnesses looked after.
Karl MᶜCartney
I thank my hon. and learned Friend for his original answer. Has he brought forward any specific steps to support an increase in convictions where men are the victims of rape or domestic abuse?
The Solicitor General
I am grateful to my hon. Friend for that question, and let me assure him that when it comes to the prosecution of rape and serious sexual offences, it applies equally to men as to women. Boys, of course, can also sadly be the victims of sexual abuse. Sentencing guidelines, of course, draw no distinction of gender, and neither should the investigation or prosecution of offences.
Andrew Gwynne (Denton and Reddish) (Lab)
Despite claims of the highest number of convictions ever, the fact is that in the last year the number of convictions for rape, domestic abuse and other serious sexual offences has fallen. What is the Solicitor General going to do to turn those worrying figures around?
The Solicitor General
I think the hon. Gentleman means that the rate has fallen slightly. I think it important to continue to prosecute more and more of these cases. For too long, many victims have found that their cases have not even been brought to court. Looking at the analysis of rape convictions, I am encouraged to see that the number of convictions that have not been brought because of a prosecution failure is reducing, so drilling down and looking at the reasons for the non-convictions is very important. We have to continue progress in that direction.
Catherine McKinnell (Newcastle upon Tyne North) (Lab)
Successfully prosecuting rape and domestic violence cases clearly requires a properly resourced CPS, yet the budget has been slashed by 25% since 2010 and the rate of ineffective and cracked trials owing to prosecution issues is at a five-year high. With senior respected personnel leaving and expressing grave concerns, do the Solicitor General and the Attorney General really believe that the CPS can sustain more cuts on the same scale and still deliver justice?
The Solicitor General
I am afraid that the hon. Lady is in error when she suggests that the number of ineffective trials is at an all-time high. As I have said, the number of cases being prosecuted continues to increase, and there is no question of prosecutions not being brought because of a lack of resources. Rape and serious sexual offences units are well resourced, and they will continue to be resourced by the CPS.
David Mowat (Warrington South) (Con)
5. What steps he plans to take to protect child witnesses in sex abuse and other cases from intimidation during cross- examination.
Mark Menzies (Fylde) (Con)
11. What recent steps the Crown Prosecution Service has taken to improve its engagement with and support for vulnerable witnesses.
The Solicitor General (Robert Buckland)
The defence case has to be put to all prosecution witnesses, but in order to ensure effective cross-examination, a mandatory advocacy course for all defence advocates is being developed and will include the cross-examination of vulnerable witnesses. Pre-recorded cross-examination has already been piloted successfully, and we are committed to a national roll-out.
David Mowat
In 2011, at Stafford Crown court, a victim of child abuse was cross-examined in a vicious and intimidatory way for 12 days by a team of seven barristers, during a session in which the judge was generally thought to have lost control of the courtroom. Such cross-examination is a massive disincentive for others to come forward. Four years later, may I ask what steps have been taken to prevent it from happening again?
The Solicitor General
I well remember that case. The good news is that in the retrial matters were handled very differently, and the outcome was successful. However, intimidatory cross-examination should not happen. Judges have a duty to ensure that young witnesses are not cross-examined inappropriately. As I have said, a new advocacy course is being developed to ensure that that sort of abuse does not happen again.
Mark Menzies
Will the Solicitor General tell us what the CPS is doing to help vulnerable witnesses, such as victims of human trafficking, to give evidence in courts?
The Solicitor General
Recently, the CPS drew up new guidelines for the care of witnesses in court. Those guidelines are currently being piloted and will be rolled out nationally in the new year. They will go a long way towards supporting witnesses, while avoiding the dangers of coaching witnesses in the giving of evidence, which, of course, would not be desirable.
Jim Shannon (Strangford) (DUP)
In the last few years, it has become clear that a great many young people have been sexually abused over a number of years and are traumatised by that abuse. Can the Solicitor General assure the House that the necessary resources are available so that the young people in all those cases can be looked after?
The Solicitor General
I can reassure the hon. Gentleman. As I have said many times before, when it comes to the protection of vulnerable witnesses and complainants in criminal cases, the CPS is always working to improve its processes so that the experience can be as smooth as possible. What we do not want is a repeat, in effect, of the abuse that those people originally suffered when they come to court and give evidence.
John Howell (Henley) (Con)
14. Operation Bullfinch, in Oxford, introduced a number of radically different procedures for coping with vulnerable witnesses. What lessons have been learnt from that?
The Solicitor General
I know that my hon. Friend has a long-standing interest in improving the processes as a result of that case, which helped to revolutionise the way in which the investigatory authorities all work together. There have been a number of other successful investigations in his own police area, which are helping to improve national practice, and there is a much greater understanding across the country of the way in which such cases can be effectively prosecuted.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
6. Whether future military action using drones overseas will require his approval.
The Attorney General (Jeremy Wright)
The role of the Law Officers in relation to military action overseas is to advise as necessary on legal questions, not to authorise the action. The use of drones in military action overseas does not of itself necessarily give rise to legal questions. The deployment of one form of equipment or another rarely does, in and of itself. Whether legal questions arise will depend on the operational context in which any form of military deployment was undertaken, and the reason for it.
Chi Onwurah
Technological development can undermine legislation under all Governments, but particularly under this Government, who seem to have no strategy for it. We need to know that, while the strikes may be made by drones, the decision makers are still accountable to the House. When will the Attorney General establish a clear legislative and ethical framework in relation to future drone strikes?
The Attorney General
Again, that is not my role within government, but the hon. Lady knows that the Prime Minister was extremely eager to come to Parliament and explain the basis of the decision to take the drone strike of 21 August, and he did so on the first available opportunity.
In terms of setting frameworks, it is important of course to treat every case on its merits. In relation to the legal position, as in relation to a political decision making process, each instance will be different and each must be considered on its own facts.
Catherine McKinnell (Newcastle upon Tyne North) (Lab)
The recent drone strike in Syria was described by the Prime Minister as a “new departure” and a first in modern times. The Prime Minister said he is
“happy to look at what other ways there may be of making sure these sorts of acts are scrutinised”.—[Official Report, 7 September 2015; Vol. 599, c. 31.]
Given that any action must be necessary and proportionate to meet the key legal tests, will the Attorney General update us on the discussions between the Government and the Intelligence and Security Committee on reviewing the action and any framework that will be put in place to ensure proper scrutiny in future?
The Attorney General
I welcome the hon. Lady to her new responsibilities and wish her well in them. I have no doubt that the new Chairman of the ISC will be discussing with the Government what inquiries they wish to take forward. On my engagement in the process, as the hon. Lady understands, the Law Officers convention makes it clear that legal advice is not disclosed outside government, nor in the generality of cases is even the fact of legal advice disclosed, but she knows, too, that in relation to this incident I thought it was right and proper that the fact of legal advice having been given should be disclosed, and it was. I hope she will understand how difficult it is to go any further than that without undermining the good reasons that I believe lie behind the LOC.
Tom Pursglove (Corby) (Con)
7. What steps the Crown Prosecution Service is taking to ensure that court time is not wasted.
The Solicitor General (Robert Buckland)
The listing of court cases is a judicial function and a responsibility of Her Majesty’s Courts and Tribunals Service, but when cases are listed the CPS takes steps to make sure the prosecution case is properly prepared and ready for an effective court hearing so the time set aside is fully utilised.
Tom Pursglove
I thank the Minister for that answer, but during a visit to Corby magistrates court I was shocked to hear about how much court time is wasted owing to the CPS not having its case together in time for when it is scheduled. Does the Minister agree that it is unacceptable for cases that are not complete to be brought to court? We really do need to get away from this; it is unacceptable and it wastes not only time but money.
The Solicitor General
I am grateful to my hon. Friend for his question. I know he works very hard with his local courts service. A lot of innovation with regard to transforming summary justice and the increasing use of digital processes is leading to quicker timescales, much more effective first hearings and a more efficient use of court time, so I think he has reasons to be optimistic.
Several hon. Members rose—
Mr Speaker
I have missed the hon. Member for Huddersfield (Mr Sheerman). It is good to have him back.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
Thank you, Mr Speaker.
A constituent of mine who is a very competent manager recently did jury service. He said the court system was medieval and it was about time someone came in and organised it better, managed it better and gave a real return to the taxpayer, with better justice delivered quickly.
The Solicitor General
I am grateful to the hon. Gentleman for his question. After many years in the courts system myself, I understand his constituent’s concerns. The good news is that a lot of work is being done to digitise the paperwork so that time can be saved. Already there is a new proposed roll-out next year, which will co-ordinate the way in which the courts work with the CPS and other agencies so the sort of delays that irritated his constituent can be reduced and removed.
Graham Evans (Weaver Vale) (Con)
9. What steps the Crown Prosecution Service is taking to increase the number of successful prosecutions for human trafficking offences involving forced labour.
The Solicitor General (Robert Buckland)
In advance of the introduction of the Modern Slavery Act 2015 the CPS delivered joint training with the police and issued guidance to strengthen prosecutions. In forced labour cases the CPS also encourages prosecution for other offences such as trafficking for forced labour, money laundering, benefit and mortgage fraud, tax evasion and Gangmasters (Licensing) Act offences.
Graham Evans
Given the sheer number of refugees fleeing the conflict in Syria, taking action against human traffickers is of the utmost importance in protecting some of the world’s most vulnerable people. What steps is my hon. and learned Friend taking to improve the confiscation of the proceeds of exploiting migrant workers into modern-day slavery?
The Solicitor General
I know that my hon. Friend has a long-standing interest in this issue. The Crown Prosecution Service is helping to improve the situation by building capacity and capability in other countries, because this is an international problem. This is being done by better linking the work of the regional asset recovery teams with that of the human trafficking investigators, so that financial investigation can become sharper and more efficient.
David T. C. Davies (Monmouth) (Con)
13. My hon. and learned Friend has outlined what is being done on an international basis. Will he go further and confirm that the Immigration Bill, which had its Second Reading this week, will help to tackle this disgraceful problem at a domestic level?
The Solicitor General
The Minister for Immigration and I have the duty of taking that Bill through its stages in this House, and I can assure my hon. Friend that its provisions will dovetail well to improve the range of tools that the authorities have to protect victims of trafficking and prosecute perpetrators.
Andrew Stephenson (Pendle) (Con)
1. What steps the Government are taking to increase the participation of women and girls in sport.
Glyn Davies (Montgomeryshire) (Con)
7. What steps the Government are taking to increase the participation of women and girls in sport.
Rebecca Pow (Taunton Deane) (Con)
9. What steps the Government are taking to increase the participation of women and girls in sport.
The Parliamentary Under-Secretary of State for Women and Equalities and Family Justice (Caroline Dinenage)
First, I would like to welcome the hon. Members for Stretford and Urmston (Kate Green) and for Lancaster and Fleetwood (Cat Smith) to their new positions. I should also like to thank the hon. Member for Ashfield (Gloria De Piero) for her commitment to promoting equality.
The Government are determined to tackle this important issue. The award-winning This Girl Can campaign is a fantastic example of the work we have been doing to encourage women into sport. It features real women of all different shapes, sizes and abilities taking part in sport and, most importantly, having fun. We know that 75% of women want to be more active, and this campaign, which has been viewed by more than 13 million people, offers them the inspiration to do just that.
Andrew Stephenson
The Pendle sports awards, which took place just two weeks ago, recognised the achievements of sportswomen across Pendle, including Bethany Widdup, who is now a member of the British ski team, and many others who have excelled thanks to grass-roots sports clubs across Pendle. What more can my hon. Friend do to give our local sports clubs the help they need to get even more women and girls involved?
Caroline Dinenage
First, I should like to add my own congratulations to Bethany. Awards such as those in Pendle provide a fantastic way of recognising the enormous effort that goes into grass-roots sport across the country, almost always involving incredible volunteers. Schemes such as satellite clubs, supported by Sport England, are helping to link schools and colleges to grass-roots sports clubs across the country, giving a better sporting experience to children and young people.
Glyn Davies
This week I watched the excellent film “Suffragette”, which illustrated just how far we have progressed in creating a fair and equal society over the past 100 years. Does the Minister agree that sport is a very effective way of continuing to make such progress? Will she join me in congratulating the media on the much greater coverage that is now being given to the participation of women in sport?
Caroline Dinenage
I absolutely agree. We have further to go, but—without wishing to rub salt into the wounds of our English gentlemen—I must mention the fact that the brilliant performance of our women’s teams in the recent football, rugby and netball world cups has showcased some fantastic role models and demonstrated character and success. That is exactly why they deserve all the media coverage they are getting—and, indeed, much more.
Rebecca Pow
If we are to build a healthier society, our children will need to engage in sport from a very young age. This applies especially to girls, who, sadly, opt out all too frequently. Some excellent youth programmes for boys and girls are running in Taunton Deane, including the centre for cricketing excellence, Taunton Vale hockey club, Taunton rugby club and Taunton football club. Will the Minister expand a little further on what the Government are doing, especially for young schoolchildren’s participation in sport?
Caroline Dinenage
My hon. Friend is absolutely right. The good news is that, in Taunton, 4,700 more women are regularly playing sport today than in 2005. Research published by the Government Equalities Office shows that year 3 is the critical stage at which to keep girls motivated to play sport. That is the last academic year before the difference between girls and boys—in terms of confidence, body image and sporting participation—starts to grow. That is why investment in schools sports, such as the £150 million a year for primary PE, is so vital for helping girls to develop this very healthy habit for life.
Andrew Gwynne (Denton and Reddish) (Lab)
I commend Manchester City football club for its women and girls programme, which provides 12 weekly sessions free of charge to girls and women between the ages of 14 and 25 to increase their participation in football. Do we not need to see other such examples spread right across football in the country?
Caroline Dinenage
The hon. Gentleman makes a fantastic point. It is an incredibly successful girls’ football team, and I know that the sports Minister, my hon. Friend the Member for Chatham and Aylesford (Tracey Crouch), is a huge champion of women’s football and not a bad football player herself.
Jim Shannon (Strangford) (DUP)
There are great opportunities for girls to participate in sport, especially in rugby and football, at schools and universities. What has been done to provide that same provision at clubs after university?
Caroline Dinenage
The hon. Gentleman makes an excellent point. We want to encourage that participation through school, university and out into life afterwards. That is why the This Girl Can campaign, which shows real women taking part in sport that is fun and not just competitive, has been such a fantastic way of encouraging them to get out there and lead a healthy lifestyle.
Graham Evans (Weaver Vale) (Con)
15. As the chairman of the all-party group for running and the father of a young daughter, I am very keen to encourage more girls to take up running, particularly through the excellent parkrun scheme. Mr Speaker, those runs are a great way to start a Saturday morning for those who, like yourself, have a young family. I recommend three miles around your local park. What is the impact of the Government’s investment in the school sports premium particularly on the take-up of sport by girls?
Mr Speaker
I am most grateful to the hon. Gentleman for his helpful public advice.
Caroline Dinenage
I thank my hon. Friend for his question. I know that he is no mean marathon runner himself. Running is a fantastic form of exercise and parkrun has been particularly effective at encouraging inactive people and those from all age groups to get involved in sport. In recognition of that, Sport England is investing £400,000 in parkrun to support its work. The primary PE and sports premium has been really effective in allowing schools to tailor this offer to pupils, giving them suitable opportunities to target particular groups, especially girls.
Mims Davies (Eastleigh) (Con)
2. What steps she is taking to tackle the causes of the gender pay gap (a) in general and (b) in STEM careers.
The Minister for Women and Equalities (Nicky Morgan)
I echo my hon. Friend’s welcome to the new shadow Ministers and I look forward to debates on these important issues.
The gender pay gap has fallen to its lowest ever level, but any gap at all is unacceptable, which is why the Prime Minister has pledged to eliminate the gap in a generation. Transparency is an important step in tackling the matter, which is why, within 100 days of the election, the Government have taken steps to fulfil their manifesto commitment by launching a consultation on legislation that will require companies to publish details of their gender pay gap. We must also tackle the causes themselves, by encouraging girls to consider a wide range of careers, including those in the science, technology, engineering and maths fields, and by transforming our workplaces.
Mims Davies
I thank the Minister for her answer. The overall pay gap of 2014 stands at 19.1%. Does she agree that more needs to be done to help full-time carers and full-time parents who decide to re-enter the workplace so that we can reduce the pay gap?
Nicky Morgan
I entirely agree with my hon. Friend. Interestingly, the gender pay gap in her own constituency is 14.3%, which is below the national average. Of course we must help more parents to get back into the workplace. I am very clear that childcare is not just a women’s issue, but a parents’ issue, which is why we are introducing flexible working, shared parental leave and more free childcare. We are also tackling the barriers that affect carers, which is why we launched nine pilots across England to test different approaches to supporting female carers to remain in work.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
The Minister knows well that girls who give up STEM subjects early on do not get into good management jobs later on. Is it not important to measure how many women are getting into senior positions, particularly in the private sector?
Nicky Morgan
I entirely agree with the hon. Gentleman. That is why transparency is so important and why the regulations that we propose will cover the private sector. He is right in what he says. Women form 47% of the workforce, but make up only 34% of managers, directors and senior officials. This must be the time to make the change.
Mrs Maria Miller (Basingstoke) (Con)
I applaud the Minister and the Government for their commitment to eliminate the gender pay gap. This generation of women over 50 working full time earn just two thirds of what men of the same age earn. What specific policies do this Government have to address that particular enduring pay gap?
Nicky Morgan
I thank the Chairman of the Women and Equalities Committee for her question. She will know from her time in government that one of the Women’s Business Council’s key strands of work involves helping older workers to stay in work. This is, of course, also about helping women to stay in work for a longer period and to get as high up in their careers as possible before they take time out for caring responsibilities. I have also mentioned the carers pilots because, sadly, even in the 21st century, the burden of caring for older relatives still often falls on women. We have to change that.
Ben Howlett (Bath) (Con)
A recent report by the Campaign for Science and Engineering found that when parents were asked what type of job they want their child to pursue when they finish education there was a clear gender bias, with parents wanting for their son a career in engineering and for their daughter a career in nursing. Does the Minister agree that it is crucial that we break down those barriers?
Nicky Morgan
I entirely agree with my hon. Friend. It is good to see, for example, that maths is now the most popular A-level, and we have more girls studying STEM subjects at both GCSE and A-level. Women are concentrated in the less well-paid occupations, making up 92% of secretaries and 94% of childcare assistants but only 7% of engineers and 20% of architects. Again, that has to change.
Bob Blackman (Harrow East) (Con)
3. If she will bring forward legislative proposals to repeal the provisions relating to caste discrimination in the Enterprise and Regulatory Reform Act 2013.
The Minister for Women and Equalities (Nicky Morgan)
The Government completely oppose caste discrimination and the judgments in the Tirkey v. Chandhok case suggest that legal protection against such discrimination already exists under the Equality Act 2010. We are considering the legislative position in the light of those judgments.
Bob Blackman
I thank my right hon. Friend for that answer. She will be aware that the case was brought under the Equality Act 2010, not the ill-thought-out and unnecessary amendment made in the other place to the Enterprise and Regulatory Reform Act. This unnecessary and divisive legislation has caused consternation in the Hindu community. Will she undertake not only not to trigger that legislation but to repeal it so that the Hindu community will know where it stands legally?
Nicky Morgan
I thank my hon. Friend for that question and I know that he feels passionately about this matter. There are, of course, strong opinions on both sides of the debate. It is important, given the case that I have just mentioned, to remember that the law as it stands has changed because of that judgment. A litigant could now seek to bring a case of caste discrimination in an employment tribunal using the ethnic origin provisions in the Equality Act, which is why we should take time to look at the judgment before making further decisions.
Mark Spencer (Sherwood) (Con)
4. What steps the Government are taking to support more women in setting up their own businesses.
Mr Alan Mak (Havant) (Con)
5. What steps the Government are taking to support more women in setting up their own businesses.
Alex Chalk (Cheltenham) (Con)
14. What steps the Government are taking to support more women in setting up their own businesses.
The Parliamentary Under-Secretary of State for Women and Equalities and Family Justice (Caroline Dinenage)
I am delighted that the UK is considered the best place in Europe for women to start a business, but we are not resting on our laurels. That is why we have launched the women in broadband fund and are running meet a mentor roadshows across the country, giving women the support, advice and skills they need.
Mark Spencer
If the Minister has the opportunity to speak to the Secretary of State for Education, will she encourage her to ensure that girls consider topics such as economics and business studies so that we can get more young women to start their own business?
Caroline Dinenage
Well, Mr Speaker, the Secretary of State is nodding furiously at me so I will take that as a yes. We have been celebrating and showcasing women in business as a great way of inspiring the next generation and, of course, we have set up the new business and enterprise company as a great way of showing girls the fantastic careers available to them in both business and enterprise.
Mr Mak
I thank the Minister for her original answer. Women entrepreneurs such as Jodie Sheppard from my Havant constituency, who has launched a business helping to improve children’s fitness, are excellent local role models. Does the Minister agree that organisations such as the Women’s Business Council offer excellent support for our women business leaders, and will the Government continue to work hard to help women who want to start their own business?
Caroline Dinenage
Jodie Sheppard, who founded Active8 Minds in Havant, is an excellent example of a capable woman running her own business and will, I am sure, be delighted with the fantastic plug her MP has given her business today. I certainly agree that the Women’s Business Council has a vital role in supporting women to reach their potential. We know that if women started their own businesses at the same rate as men do, we would have an extra 1 million women involved and an extra 1 million businesses in the UK.
Alex Chalk
Cheltenham is home to thousands of talented female entrepreneurs, but broadband and superfast broadband are key to unlocking that potential. How are the Government helping more women in Cheltenham to grow their businesses online?
Caroline Dinenage
The fund has been extended for a second year, with an additional £1.1 million to support more women to take their businesses online, enabling them to develop the skills they need to become competitive in a growing digital economy. One example of which my hon. Friend might be aware is the Faster Women project, which is supporting women in Herefordshire and Gloucestershire to develop digital skills. Today, a workshop is taking place in his very own Cheltenham to help women take the first steps to putting their businesses online.
Rebecca Long Bailey (Salford and Eccles) (Lab)
6. What steps she is taking to tackle pregnancy and maternity discrimination in the workplace.
Angela Rayner (Ashton-under-Lyne) (Lab)
12. What steps she is taking to tackle pregnancy and maternity discrimination in the workplace.
The Minister for Women and Equalities (Nicky Morgan)
Pregnancy and maternity discrimination is unlawful and completely unacceptable. The Government and the Equality and Human Rights Commission are working together on the largest independent research project of its kind in Great Britain to better understand the problem. The detail of the final report is due to be published later this year and will inform the Government’s response.
Rebecca Long Bailey
Many women across Salford and Eccles have returned to work after maternity leave with a very uneasy feeling about whether they have a job. The report to which the right hon. Lady refers has found that women returning from maternity leave are even more likely to face discrimination in the workplace than they were a decade ago. What assurances can she offer people in Salford and Eccles that this will not be the case in generations to come?
Nicky Morgan
It is true that when the interim report was published in July this year, we were all disappointed to see that around one in eight women reported that they felt they had to leave work as a result of their pregnancy or maternity leave, but it also shows that the vast majority of employers believe it is important to support pregnant women and women on maternity leave, so we have to build on that. That is why the report will be so helpful in working out exactly what our response should be to make sure that we change this, as the hon. Lady says, not in decades but in a few years ahead.
Angela Rayner
Will the Minister join me in welcoming the work done by Joeli Brearley of Pregnant then Screwed, a Greater Manchester-based organisation campaigning to raise awareness of the appalling examples of discrimination in the workplace? More importantly, will the Minister pledge to work with organisations such as Pregnant then Screwed to help tackle this inequality in the workplace?
Nicky Morgan
I look forward to hearing more about the work that Joeli Brearley has been doing. As I mentioned earlier, we expect the report this year to tell us the types of issues that women face, the perceived discrimination where it is occurring, who is most at risk and which employers in terms of size and sectors are most likely to get complaints. I will then be open to working with all organisations to tackle that discrimination. If the hon. Lady would like to write to me with further details about her constituency organisation, I would be delighted to see them.
Angela Crawley (Lanark and Hamilton East) (SNP)
Unlawful maternity and pregnancy discrimination is now more common in Britain’s workplaces than ever before. One in nine women are forced out of their jobs as a result of discrimination in the workplace. In July 2013 the UK Government introduced employment tribunal fees of up to £1,200, amounting to a barrier for women and a charter for rogue employers. What action is the Minister taking to tackle this issue?
Nicky Morgan
Before answering the hon. Lady’s question, may I congratulate her? I understand that she was the winner of the Icon politician of the year award last week for her work. In relation to the fees for employment tribunals, on 11 June this year we announced a post-implementation review of the introduction of fees for employment tribunals. The review is being led by the Ministry of Justice. It is well under way and is due to report later this year. I think we should await the outcome of that review to determine whether current fees or the remission scheme need to be adjusted.
Cat Smith (Lancaster and Fleetwood) (Lab)
According to research from the Equality and Human Rights Commission, one in nine mothers have lost their jobs due to pregnancy discrimination, yet since the introduction of employment tribunal fees nearly seven in 10 cases that could have gone before tribunals are not going ahead, according to Citizens Advice. Why are the Government giving the green light to employers to discriminate against women?
Nicky Morgan
As I said, I welcome the hon. Lady to her position on the shadow Front Bench, but I disagree with her, which will not surprise her. We are not giving any form of encouragement to employers to discriminate. I mentioned the post-implementation review of the introduction of fees, and I should point out that in order to protect the most vulnerable in society, there is already a system of fee remissions under which fees can be waived in part or in full for those who qualify. It is right to try to divert people away from potentially acrimonious proceedings through a conciliation scheme operated by ACAS, but we should also see where the review leads and what it tells us about fees and their impact.
Fiona Mactaggart (Slough) (Lab)
8. What comparative assessment she has made of the potential effect on women and men of proposed changes to working families tax credit; and if she will make a statement.
The Exchequer Secretary to the Treasury (Damian Hinds)
The Government want to move from a low-wage, high-tax, low-welfare—I mean, high-welfare—society to a high-tax—[Laughter.] This was always going to happen one day; I apologise profusely. We want to move to a high-wage, lower tax, lower welfare society, and this includes some changes to tax credits to help put benefit spending on a more sustainable path. The impact of those changes on different groups with protected characteristics, including gender, has been considered by Treasury Ministers as part of the overall summer Budget package.
Fiona Mactaggart
The Minister says that it has been considered, but it has not been acted upon. We know that benefits such as child tax credit are twice as big a proportion of women’s income as they are of men’s. He will recall that in August 2014 the Prime Minister said that
“every single domestic policy that government comes up with will be examined for its impact on the family.”
What was the examination in relation to child tax credit, and what has he done about it?
Damian Hinds
We are in the process of delivering on our deficit reduction imperative, which the House had an opportunity to debate last night. The reductions in tax credits are an important part of that, but they form part of a package, along with measures such as the national living wage, childcare and changes in the personal allowances for income tax. As a result of the income tax change, 660,000 individuals will be lifted out of income tax, 60% of whom will be women. We believe that about two thirds of the beneficiaries of the national living wage will also be women.
Jo Churchill (Bury St Edmunds) (Con)
10. What assessment she has made of the implications for her policies of the responses received to the Government Equalities Office’s recent consultation on closing the gender pay gap.
The Minister for Women and Equalities (Nicky Morgan)
As I have said, the Government are absolutely committed to eliminating the gender pay gap for good. Our consultation closed on 6 September. We received nearly 700 responses, including from 200 employers and business organisations, including the CBI. The responses from employers have been extremely positive, recognising that we all have a stake in the issue. We will consider the responses and bring forward new regulations shortly.
Jo Churchill
As my right hon. Friend knows, this subject is of great importance to me, but it leads to a broader question: what are the Government doing to ensure that the pipeline to senior management and director level for women is encouraged, because we still have a 32% earnings differential between women and men in large organisations, which is considerably larger than the 19% alluded to earlier?
Nicky Morgan
My hon. Friend might be interested to know that the gender pay gap in her constituency is 18.2%, which is just below the national average. I agree that this is an important issue. We have more women on FTSE 100 boards than ever before. In fact, we now have no all-male boards in the FTSE 100. Women now make up more than 25% of those boards. However, there is much more to do. She is absolutely right to talk about the executive pipeline. We have to get more women into management and executive positions, and we are currently looking at that issue.
Kate Green (Stretford and Urmston) (Lab)
I welcome the Minister’s commitment to introducing regulations on compulsory reporting. There is clearly a way to go when the UK’s gender pay gap is 19.1%, which significantly exceeds the European Union average of 16.4%. But does she agree that publishing alone will not be enough? If the information is to be useful, it needs to be consistent, standardised and readily available to workers and their representatives.
Nicky Morgan
I welcome the hon. Lady to her position on the Front Bench. I entirely agree that transparency is important, but the next thing will be what employers, organisations and others do with that information, and how it drives change so that the gender pay gap is eliminated. Also, as we heard from one of her colleagues earlier, it is about how we ensure that women are represented in greater numbers throughout all our workforces.
Kate Green
I am glad that the Minister agrees that the information should be accessible and meaningful, and companies must know that the Government treat this matter with the utmost seriousness. Will she therefore explain why, in the very week that the Prime Minister was proclaiming his support for action at the Conservative party conference, Conservative MEPs were voting against a recommendation that companies should disclose their gender pay gap? Is she not worried about the message that that sends out?
Nicky Morgan
I cannot remember another occasion when a Prime Minister has turned up to something like a CBI conference and chosen the issue of the gender pay gap to highlight. I think that sends the greatest signal. With regard to our MEPs, the view that was taken was that this is a matter for member states, and we could not have a stronger signal from the top of this Government downward that, in this member state, this Government and this Prime Minister intend to tackle the gender pay gap and eliminate it.
Mr Philip Hollobone (Kettering) (Con)
Will the Minister organise a meeting in her office to which she can invite the chief executives of the largest employers with the largest gender pay gap and the chief executives of the largest employers with the smallest gender pay gap so that one group can learn from the other?
Nicky Morgan
I thank my hon. Friend for that very practical suggestion. I am sure that my officials have taken a careful note of it, so we will go away and see how and when we can make it happen.
Suella Fernandes (Fareham) (Con)
11. What steps she is taking to increase the number of girls studying science, engineering and maths at school and university.
The Minister for Women and Equalities (Nicky Morgan)
In the week in which we celebrate Ada Lovelace day, let us be clear that we cannot allow any girl to grow up thinking that some careers are off limits because of their gender or background. It is almost exactly one year since we launched the fantastic Your Life campaign, which is encouraging more and more girls to consider careers in STEM—science, technology, engineering and maths—related fields. As I have said previously in this House, the UK needs 83,000 engineers a year over the next 10 years, and, to be frank, they cannot all be men.
Suella Fernandes
I am pleased that record numbers of girls are studying STEM subjects at school and university. I recently crossed the border into my neighbouring constituency of Gosport—that of the Under-Secretary of State for Women and Equalities and Family Justice, my hon. Friend the Member for Gosport (Caroline Dinenage)—to visit the defence technology company QinetiQ, of which she is an enthusiastic supporter, to support its powerboat challenge, in which it engaged directly with local schools to encourage their pupils to study STEM subjects. What more can local businesses like QinetiQ do to engage directly with business so that young people, particularly girls, take up these subjects?
Nicky Morgan
The excellent work that QinetiQ is doing demonstrates how girls’ aspirations can be broadened by engaging with local businesses. Its managing director and its apprentice of the year are both female, which is a good start. We are working with British Chambers of Commerce to explore different approaches to school and business partnerships. Last year I announced that we would fund a careers and enterprise company to strengthen links between employers and young people so that they can act in a broad range of careers and so that, at a young enough age, they are inspired by the careers opportunities that are open to them and nobody says that any doors are shut to them.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
13. What steps she is taking to encourage diversity reporting in technology sectors.
The Parliamentary Under-Secretary of State for Women and Equalities and Family Justice (Caroline Dinenage)
Of course, companies work better when their workforce reflect Britain’s diversity. It is more important than ever that we make the most of everyone’s skills and talents to maximise our economic growth. That is why we are requiring larger companies, including those in the technology sector, to publish their gender pay gap so that they have the incentive and the information they need to improve fairness for women.
Chi Onwurah
I welcome the Minister’s warm words on women in technology, but she will know that the British Computer Society’s recent IT scorecard showed a lamentable lack of progress in increasing the proportion of women in tech jobs. She will also know that I have long campaigned on this subject. Companies that hide on this key issue for our economic future are betraying the next generation of engineers and technologists. What will she do to ensure that companies and her Government publish information on tech diversity?
Caroline Dinenage
The hon. Lady is an incredible champion for the whole of the STEM world, but particularly for women in engineering. Diversity is wider than just gender, of course; it extends to race and social background. Evidence shows that educational attainment is the single biggest predictor of the future life chances of children. We are requiring businesses to publish their gender information. Driving change through transparency works, as we know from the results of the work that Lord Davies has done. There are now no all-male boards in the FTSE 100. We want to continue this work, particularly in Ada Lovelace week. In an international week celebrating women in STEM industries, there is no better time to be publishing this information, holding businesses to account, and encouraging women to do the very best they can in the fields of engineering.
Maria Caulfield (Lewes) (Con)
16. What steps the Government is taking to support more women in setting up their own businesses.
The Parliamentary Under-Secretary of State for Women and Equalities and Family Justice (Caroline Dinenage)
The Government are committed to supporting women to start and grow their own business. Last year 5.7% of women in the UK were involved in starting or running a new business, and we would of course like that number to grow. The start-up loan scheme provides mentoring and financial support to entrepreneurs. It has now made over 28,000 loans worth over £150 million, with 38% of those going to women-led businesses.
Maria Caulfield
Does the Minister agree that by extending the provision of free childcare we are helping more women into work and enabling more women to start their own business? Women in my constituency certainly agree that that would be a big help in doing so.
Caroline Dinenage
My hon. Friend makes an excellent point, and I wholeheartedly agree. I am delighted that tax-free childcare could provide about 1.8 million families across the UK with up to £2,000 of childcare support per child per year. This will be rolled out from early 2017. I welcome the fact that for the first time self-employed women will be able to benefit from this vital childcare support.
Andrew Bridgen (North West Leicestershire) (Con)
17. What support the Government provides for lesbian, gay, bisexual, and transgender people who receive abuse or harassment online.
The Minister for Women and Equalities (Nicky Morgan)
The Government are absolutely clear that abusive and threatening behaviour online, whoever the target, is unacceptable. What is illegal offline is also illegal online. My Department has funded the development of a new website—Stop Online Abuse—which launched on 17 June. It provides advice on action that individuals, particularly LGBT people, can take against offensive, damaging or threatening content online and in other media.
Andrew Bridgen
As part of my casework I have been contacted by a teenager who is fearful of telling friends and relatives that he is gay. Such young people may be at particular risk of bullying. What particular help is the Minister offering schools to support such cases?
Nicky Morgan
No young person should ever feel that they are not able to be honest about themselves and their sexuality for fear of bullying. Tackling all forms of bullying is a priority. We have awarded £2 million to charities and community sector organisations, to help schools tackle homophobic, biphobic and transphobic bullying. I have also had the privilege of visiting some schools that are tackling the issue head on, such as Eastbourne academy and Caludon Castle school in Coventry, which are both Stonewall champion schools.
Greg Mulholland (Leeds North West) (LD)
One quarter of LGBT students at school say that they suffer online abuse. Is the Minister working with the Department for Education to provide proper advice to schools, and is she working with the National LGBT Hate Crime Partnership’s excellent Speak Up campaign to tackle this particular form of bullying and hate crime?
Nicky Morgan
I am open to working with all organisations in order to stamp out this hate crime. I am lucky enough to hold two Government jobs and am able to bring them together on this particular issue and provide £2 million of funding to pilot projects across the country to work with schools in order to stamp out unacceptable homophobic, biphobic and transphobic bullying. The secret seems to be to take a whole-school approach, with everybody from the head to the teachers and pupils knowing exactly that that sort of behaviour is unacceptable.
Paul Blomfield (Sheffield Central) (Lab)
18. What steps she is taking to increase the number and accessibility of women’s refuges.
The Parliamentary Under-Secretary of State for Communities and Local Government (Mr Marcus Jones)
We are committed to making sure that no victim of domestic abuse is turned away from the support they need. In July the Chancellor announced an additional £3.2 million to increase specialist accommodation support for victims, including refuges, and to provide more help for victims to access that support.
Paul Blomfield
During my annual community consultation over the recent recess, lots of women constituents raised concerns about the future of refuges, recognising that local authority funding was being stretched to breaking point, particularly in big cities such as Sheffield. The Government’s recent £10 million cash injection is a sticking plaster that will only delay closures. Will the Minister use the forthcoming spending review to put in place a long-term funding solution for the national network of refuges?
Mr Jones
I reassure the hon. Gentleman that our goal is to ensure that no victim of domestic abuse is turned away from the support they need. We have recently carried out, along with the Home Office, a review of domestic abuse services, and its emerging conclusions will feed into the spending review and the updated Home Office strategy on tackling violence against women and girls. As I am sure the hon. Gentleman is aware, all future funding will be dealt with in the forthcoming spending review.
Dr Roberta Blackman-Woods (City of Durham) (Lab)
20. . As my hon. Friend the Member for Sheffield Central (Paul Blomfield) has just pointed out, funding for refuges is under great pressure. A recent report by Women’s Aid said:“The current model for funding specialist domestic and sexual violence services is not fit for purpose. Many services are under huge financial pressure”and are being “forced to close” or to use reserves just to survive. What is the Minister going to do about that?
Mr Jones
As I have said, this is subject to the spending review, but Women’s Aid has warmly welcomed the funding recently announced by the Chancellor. It is important for local authorities to provide such services, and it is also important to note that these services are still being provided up and down the country. We should not talk them down, as Labour Members are doing, because the fact is that if we talk down services and people think they are not available, many women may not come forward and access the important services they need.
Kirsten Oswald (East Renfrewshire) (SNP)
19. What recent assessment she has made of the effect on equality of the Government’s policies on child poverty.
The Minister for Women and Equalities (Nicky Morgan)
The Government are committed to governing as a one nation Government and achieving true social justice, which is why we want to tackle the root causes of poverty and improve the life chances of all children. Our proposals in the Welfare Reform and Work Bill introduce new measures of worklessness and of educational attainment, which will make the biggest difference to disadvantaged children now and in the future.
Kirsten Oswald
Does the Minister agree that the Government’s rebranding of the child poverty commission as a social mobility commission represents a damaging shift in emphasis? The most vulnerable children will be disadvantaged by this change in tack and by a lack of focus on the equality of outcomes for children living in poverty.
Nicky Morgan
No, I do not agree with the hon. Lady because this Government’s approach is working. The number of children on relative low incomes has fallen by 300,000 since 2010, and the number of children who grow up in workless households is also at a record low. If she wants to focus on outcomes, I encourage her to focus—as we do, particularly in education—on the outcomes of all children. The gap between the advantaged and the disadvantaged has narrowed since 2010.
Mr Peter Bone (Wellingborough) (Con)
Does the Minister agree that one of the best ways to reduce child poverty is to get into work families that do not have a breadwinner? Is that not exactly what this Government have been doing so successfully?
Nicky Morgan
My hon. Friend is absolutely right that work is absolutely the best way out of poverty. Of course, yesterday’s employment numbers showed strong employment growth, including the fact that there are now over 920,000 more women in work in this country than in 2010.
Redcar Steelworks
(8 years, 6 months ago)
Commons ChamberRead Full debate Read Hansard Text
Urgent Questions are proposed each morning by backbench MPs, and up to two may be selected each day by the Speaker. Chosen Urgent Questions are announced 30 minutes before Parliament sits each day.
Each Urgent Question requires a Government Minister to give a response on the debate topic.
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Mr Speaker
Before I take the urgent question, may I underline to the House that its narrow terms should be adhered to? This must not simply be a re-run of exchanges that took place the other day. That is the first point.
The second point that it might be helpful for the House to know is that I am keen to move on to business questions at approximately—but very close to—10.50 am, so this will be a pithy exchange.
Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)
(Urgent Question): To ask the Secretary of State for Business, Innovation and Skills if he will make a statement on the Government’s £80 million released to help former employees of the SSI steelworks in Redcar.
The Minister for Small Business, Industry and Enterprise (Anna Soubry)
I may break your rule, Mr Speaker, because I actually have quite a lot to say over and above what was said on Tuesday.
We know and accept, and everybody understands, that this is a deeply dreadful time for all concerned in Redcar. That is why, on 2 October, the Secretary of State and I went to Redcar—I had been there since the previous Wednesday—and announced a package worth up to £80 million to help both the workers directly affected and the supply chain and the local economy more broadly. We briefed the local taskforce, including the hon. Member for Middlesbrough South and East Cleveland (Tom Blenkinsop), that day on the contents of the package.
As Members will know, some elements of that package have already been rolled out and are delivering support. In terms of helping individuals, only yesterday the Jobcentre Plus service co-ordinated a very large and very successful jobs fair to help people affected to move into jobs as quickly as possible. Initial reports are that about 1,500 people attended the event, along with 50 employers offering 1,000 vacancies. That is on top of the individual support sessions that Jobcentre Plus has already been offering locally.
The redundancy payments service has established a dedicated team to process the redundancy pay, holiday pay, arrears of wages and other elements that are due to SSI employees. That is of course subject to statutory limits, but will be done as quickly as possible. I also note that the Government’s business support helpline is prioritising calls from businesses directly affected by the SSI closure, businesses in the local area with the potential to grow and take on former SSI employees, and former SSI employees who are looking for advice on starting a business. That is up and running, and it is working well. Callers will be fast-tracked to an expert adviser, who will provide advice on the issues they are facing, provide information on the local support package and refer them on to any other forms of support they need. That is a good start, but we know we need to do more.
As Members will be aware, we established a local taskforce to help to shape the support to be provided. Right from the start, our intention was not to impose solutions from Whitehall, but to ask the local taskforce for solutions on how best to target money and support. It is meeting right now, but I can understand why both Members who are part of the taskforce—the hon. Gentleman and the hon. Member for Redcar (Anna Turley)—are in the Chamber and not at that meeting. We have now received some initial proposals from the taskforce about supporting workers impacted by the closure of SSI, mitigating the impact on other companies directly affected by the proposal and supporting the growth of the wider economy. As hon. Members might imagine, we are assessing those projects urgently.
I know that the hon. Member for Middlesbrough South and East Cleveland has asked about further education colleges. The full cost of retraining former SSI workers and others made redundant in the supply chain will be met. Local colleges will therefore be able to claim full funding for education and training provided to any learner who was employed at the SSI Redcar plant at any time during 2015, or to a learner made redundant in the supply chain as a result of the plant closure, to support them to gain employment or start their own business. Eligibility will be confirmed by a referral from a Department for Work and Pensions work coach or a National Careers Service adviser who is working with affected individuals. That will enable local colleges to provide wide-ranging support to learners for short programmes of training that enable immediate entry into the labour market or for study that leads to full qualifications such as A-levels or their equivalents. Colleges that meet the quality criteria will receive additional funding to cover the costs incurred because of the additional flexibilities.
I will continue to work closely with the local taskforce, as I hope will the hon. Members for Middlesbrough South and East Cleveland and for Redcar, on how we can best support the workers of SSI, the affected supply chain and the local economy. I pledge that no worker will be left behind.
Tom Blenkinsop
The official receiver has indicated that the Government have released no further funds to buy coke. The last shift at Redcar coke ovens pushed the final bed this morning. One hundred and seventy years of steelmaking have come to a terrible, shuddering halt in only four weeks.
Since the liquidation announcement, we have learned that the original figure of £80 million was a public relations gimmick. There is no new money. Why has the Secretary of State continued to ignore calls to provide at least £30 million of new money, when it has been demonstrated that that money is guaranteed under statute for any worker who undergoes redundancy? Why have no colleges or training providers dealing with SSI workers, contractors and downstream workers received any additional funding on top of their existing budgets? What are the estimated clean-up costs of the Teesside Cast Products site in Redcar? How will security and funding be guaranteed for the Redcar bulk terminal and beam mill, which are still in operation? Why are arguably the best coke ovens and the largest blast furnace in Britain, which are on one of the handful of sites in the EU where production costs are lower than 90% of other EU sites, being allowed to close, while less efficient sites continue during this global steel price downturn?
Anna Soubry
That was a large number of questions and time precludes me from answering them all. I undertake to ensure that any questions that are not answered in what I say receive a written response.
It is not true that there is no new money. There is an £80-million package, £30 million of which is an estimated figure. We discussed all that during the urgent question on Tuesday. Indeed, the hon. Member for Redcar said that the estimate was between £20 million and £30 million. In any event, there is at least £50 million of new money. I have answered the question on FE colleges. That £50 million of new money is there to support the workers and the supply chain, so that there is reskilling, retraining and—[Interruption.] I am sorry, but I cannot hear what the hon. Member for North Durham (Mr Jones) is saying. If he wants to ask a question, he is more than capable of doing so, and I will answer it.
The reason why we are in this situation in Redcar is that, unfortunately, month on month, year after year, SSI lost money. It never made money at the Redcar steelworks. The coke ovens, as I said on Tuesday, were losing £2 million month on month. That is the harsh reality. The hon. Member for Middlesbrough South and East Cleveland knows the situation. Of course he feels huge passion about it because he has put a long-seated investment of his own life and skills into the plant. He knows the devastating effect that its closure will have on the local community, but the Government have done all they can and now we have to look to the future.
Anna Soubry
They absolutely have. The hon. Gentleman who shouts at me from a sedentary position knows what Government officials and I have done on numerous occasions in the face of the most peculiar and appalling practices from the Thai owners. He knows that on one occasion, for example, the employers liability insurance had not been paid. We found out at 4.20 in the afternoon. I was making calls at 9 o’clock at night to make sure that the workers still had their insurance cover at least up to Monday. We literally scrabbled around looking for money. We made sure that the workers were paid their wages. He knows that that was done on the specific direction of myself and the Secretary of State, who said, “Get the money together to make sure the workers are paid.” Those are the sorts of things that the Secretary of State and I have done.
Now we have to look to the future to ensure that there is a future for the workers, their children and their grandchildren. That is what this package delivers.
Mr Speaker
I thought the hon. Gentleman was standing—I had been so advised. Never mind; it is a rarity that he does not wish to contribute. I call Mr Alan Mak.
Mr Alan Mak (Havant) (Con)
Will the Minister confirm that although strict EU state aid rules have prevented the Government from directly intervening in the steel industry, the £80 million package that they have announced represents strong and practical intervention in a difficult situation?
Anna Soubry
That is the case. It is not good enough for Labour Members, who know the confines of the state aid rules, to shout “rubbish”. Let me put SSI’s losses on the record: 2012, £275 million; 2013, £193.5 million; 2014, £81 million. Until the end of June 2015, there were losses at Redcar of £92.5 million. That represents more than £0.5 billion of losses in little more than three years. That is indeed heartbreaking, but it is the harsh financial reality of the situation at Redcar.
Kevin Brennan (Cardiff West) (Lab)
One has to ask what moral universe Ministers inhabit if they think that it is acceptable to spin about the financial package for workers at Redcar. We have just heard an admission from the Minister that the figure is not £80 million, which is the figure that the Government have used and widely publicised. She now claims that there is £50 million of new money, but we need to look more closely at that. How much of that money is from the Work programme? How much is money that Ministers have put aside from the Government’s resources as new money to help the workers at Redcar, and how much is just recycled spin? That is what we have been getting from the Minister.
There are still questions to answer—I will not go on for too long because of what you said earlier, Mr Speaker—[Interruption.] The Minister said “Oh good”. I bet she did. She has not said anything to answer questions about the clean-up of the site, which she was asked earlier this week and today. This country needs an industrial strategy. We are losing an irreplaceable strategic national asset without a fight from our country’s Government, and that is an unforgiveable betrayal.
Anna Soubry
I will accept some criticisms, but to say that I have not fought for Redcar is outrageous because it is not true. I assure the hon. Gentleman that my officials and I worked—I have an email trail that proves it—until midnight last night—[Interruption.] There is no point shouting as it does not achieve anything. I was on the phone on that Friday night until 9 o’clock in the evening, and along with the Secretary of State and my officials, I was literally going around looking for sums and pots of money to help. The harsh reality is £0.5 billion of losses over five years.
On the clean-up operation, if the hon. Gentleman had taken time to find out from the taskforce and the meeting that I attended on 2 October—[Interruption.] I was there; he was not. I am trying to tell him, but he is sitting there pointing his finger and heckling. It does not get us anywhere.
Anna Soubry
Yes, well I’m entitled to under the circumstances. I answered this question on Tuesday, but I am happy to answer it again. In truth, the Health and Safety Executive and the Environment Agency had been engaged with my officials for some considerable time leading up to 2 October because we feared that that day would come. The hon. Gentleman should know—this is my experience having gone to Redcar—that some of the people with the most responsible realistic assessments of the situation were the leaders of the unions, and particularly the Community trade union leadership. Because they were working there, they knew the awful, harsh financial reality of a plant that was losing £0.5 billion over five years.
Mark Spencer (Sherwood) (Con)
The Minister will be aware that we had a similar experience in Sherwood with the collapse of UK Coal. Will she assure the House that Government support and taxpayers’ money will go into the pockets of workers to help them to get new careers, and not into the pockets of receivers, accountants, consultants and a failing company?
Anna Soubry
Yes, I can give my hon. Friend that assurance. I pay tribute to him for the work he has done for the workers at Thoresby. May I put on record that this sum of money, which is new money, represents £44,000 and more of investment per worker—it is investment in them as individuals—so that they can get the skills and training they need to get new jobs?
Anna Turley (Redcar) (Lab/Co-op)
The Minister is overseeing the death of 170 years of steelmaking on Teesside. It does not have to be the end—the site is still viable. You’ve thrown the towel in. I have literally just got off the phone to people on the site. German companies are willing to buy foundry coke that we can produce in the coke ovens. That sells at £520 a tonne, compared to £190 for ordinary coke. The site is viable. We have companies willing to invest. We have companies willing to come in and supply the coke ovens to keep the plant running and to do the mothballing. You are not giving us time. You are just throwing the towel in. The official receiver has not done proper diligence. We can find buyers, we just need three months. Please, keep the plant alive. You hide behind the excuse that it is the Thai banks, the Swiss banks, the American banks, the British banks—this is British industry.
Mr Speaker
Order. We have the point. Can people please remember that I haven’t done anything in this matter?
Anna Soubry
And neither have I, apparently, Mr Speaker. But I have and I think the hon. Lady knows that. The hon. Lady is fighting for her constituents. She does so with passion and she is right so to do. She is putting on record that this is the end of steel production. It is a tragedy. But what I would say to the hon. Lady is this: I have an email trail that she knows I am more than happy to share with her and the hon. Member for Middlesbrough South and East Cleveland. I do not know all the detail, because some of it is apparently commercially sensitive, but she needs to know this. The official receiver specifically said to those people who were interested, “Put the money in to buy the coal to keep the coke ovens going” and they refused. That is the harsh reality.
Wendy Morton (Aldridge-Brownhills) (Con)
Does my right hon. Friend agree that in these circumstances it is right and proper that the Government do all they can—which they are doing—to support the workers in Redcar and in the communities around Redcar?
Anna Soubry
My hon. Friend is right. What happened on 1 October, when we were looking at ways of support, is that we suddenly discovered—literally on a website, on a tweet—that the parent company in Thailand had effectively gone into administration and had registered so in Thailand. That changed things completely. The Secretary of State and I sat in Redcar at 9 o’clock that morning and we knew and understood that any money we put in would go straight into Thailand and into the pockets of three Thai banks. There are no procedures and no devices in those circumstances to ensure that the money would, in any event, have gone to Redcar—never mind the state aid rules.
Andy McDonald (Middlesbrough) (Lab)
Why is the Minister not listening to the two consortia that have come forward with bids at the last minute? They should be given the opportunity to formulate those bids and the Government should be keeping it going. It is no good doing the Pontius Pilate act and just washing your hands of the responsibility. Why are Ministers privately supporting mothballing, yet not getting that support from the Secretary of State and the Prime Minister? If you can’t answer this, what are you there for? What’s your purpose if you don’t step up?
Anna Soubry
The hon. Gentleman is right, but I am afraid he is, in this instance, absolutely wrong. The situation is that, yes, there have been expressions—[Interruption.] No, let me answer. He is right that there have been expressions of interest very late in the day, after the official receiver said on Monday that no deals had been forthcoming that were workable. The official receiver then went back to those consortia and said, in effect, “Put your money where your mouth is,” and they refused—[Interruption.]
Mr Speaker
Order. Mr McDonald, I absolutely understand and empathise with your incredibly strong feeling on this subject—and I mean that—but we cannot have a situation in which people yell at a Minister who is giving an answer. You might not like the answer, but, forgive me, the answer must be heard. The Minister is capable of looking after herself, but the answer must be heard. Please. I will always give people a chance, but the Minister must be heard.
Anna Soubry
The hon. Gentleman can sit there and say, “You can”, until he is blue and red in the face, but the state aid rules are incredibly clear.
Anna Soubry
The hon. Gentleman forgets that the last time Redcar was mothballed, it was mothballed by Tata, and it did so because those were the state aid rules. If there was a viable offer and anyone looked, as they have, at the situation at Redcar, they would say, “Those ovens are losing £2 million month on month”. The steel was losing half a billion pounds. In reality—and the official receiver has said the same—who will want to invest in something that was losing money hand over fist?
Huw Merriman (Bexhill and Battle) (Con)
I wish to convey my sympathies to the community in Redcar following this devastating news, but I would mention that the steel price has almost halved in the last year, China now produces 50% of steel, whereas in 2000 that figure was 15%, and the number of jobs has reduced under successive Governments. Is not the key thing now, on a cross-party basis, to deliver this retraining and bring more jobs to the north-east?
Anna Soubry
I very much agree with my hon. Friend. The harsh reality is that all the steel industries in this country are losing huge amounts of money. Some companies are regularly losing £700 million per year. That is the reality, but we are determined not to lose the steel industry in this country, so we now have to find the solutions to save it.
Mr Kevan Jones (North Durham) (Lab)
I do not question the Minister’s efforts, but she has clearly been hung out to dry by the Prime Minister and the Business Secretary. Many small companies in the north-east are affected by this closure. Has the Department drawn up a register of where they are, and what measures will she put in place to help those small companies that are creditors?
Anna Soubry
I always give a straight answer to a question. I honestly do not know the answer, but I will make inquiries and write to the hon. Gentleman and everybody else who is concerned. I must make it clear, however, that I, the Business Secretary and the Prime Minister are as one on this.
John Stevenson (Carlisle) (Con)
Clearly, we are all concerned about the loss of jobs at Redcar and the impact on individuals and families, but would the Minister agree that the only way to create new jobs and businesses is to invest properly in infrastructure and skills, and will she make this a priority for Redcar?
Anna Soubry
Yes, absolutely, and that is why we have put this package together, which, as I say, is worth about £44,000 to each worker.
Margaret Ferrier (Rutherglen and Hamilton West) (SNP)
It is important and proper that resources and support be given to mitigate the impact of the closure of SSI Redcar, particularly for those staff who will lose their jobs, but it is reactionary, and it seems that little has been learned with the benefit of hindsight. In how many other constituencies will the Government need to repeat this process? What will they do to support the steel industry in my constituency at Clydebridge and that of my hon. Friend the Member for Motherwell and Wishaw (Marion Fellows)—
Mr Speaker
Order. I am sorry, but we must focus narrowly on this particular situation, rather than on wider issues. I think we can leave it there.
Anna Soubry
Just to say, we are holding a steel summit tomorrow. All these matters will be raised, and I am sure we will share all the outcomes with the hon. Lady.
Mr Speaker
I hope the hon. Lady is satisfied with that holding response. Thank you, Minister.
James Morris (Halesowen and Rowley Regis) (Con)
I recognise the difficulty of the situation in Redcar, especially as I represent a seat in the west midlands with a long and proud history of steelmaking, but will the Minister agree that her and the Government’s focus should be on taking all the practical action necessary to provide alternative job opportunities and reskilling for the people affected in Redcar?
Anna Soubry
I absolutely agree and embrace everything that has been said, and would add that the task now is to ensure we do everything we can to support this vital industry, as the Prime Minister said.
Dr Roberta Blackman-Woods (City of Durham) (Lab)
This is not the first time the north-east has suffered the closure of steelworks under a Conservative Government. As well as being devastating for those communities, it can take a long time for people to move into alternative employment. The Minister mentioned short-term training, but will she stay with those workers for the longer term to ensure they find new employment?
Anna Soubry
There is a side of me that cannot be bothered to play party politics because this issue transcends it, but it needs to be said that the last time the Redcar plant closed was under a Labour Government. In other words, it is all completely meaningless. What the hon. Lady suggests is vital and she makes a good point. One thing we do know is that a large number of the people who were laid off last time did not return when the plant reopened, and it is newer and younger workers who are now, unfortunately, being made redundant at SSI.
Mr David Nuttall (Bury North) (Con)
As the hon. Member for North Durham (Mr Jones) has said, the livelihoods of thousands of self-employed people and workers in small enterprises will now be at stake as a result of the collapse of SSI. Can the Minister confirm that Her Majesty’s Revenue and Customs will deal sympathetically with those small businesses, which may now be unable to meet their liabilities as a result of the collapse of this company?
Nic Dakin (Scunthorpe) (Lab)
The coke ovens and the blast furnace are national assets, and this Government should do everything, even at this eleventh hour, to secure them so that they are not lost and are instead retained in order to allow the future to be bright again.
Anna Soubry
That is exactly what we will do: we will do everything we can, within the law, and bearing in mind the harsh economic realities that face Britain’s steel industry.
Greg Mulholland (Leeds North West) (LD)
Teesside without steel is almost unthinkable, and I hear nothing from the Government on how they are going to replace these 2,200 jobs. The Minister has talked about small business, but it is simply not realistic to expect people to do what she has suggested without help with living costs. Will she therefore confirm that there will be help with living costs within start-up allowances?
Anna Soubry
What I can confirm is a £50 million package that will mean that, in effect, there is an investment of £44,000 in each and every worker to help them find alternative work.
Nick Thomas-Symonds (Torfaen) (Lab)
It was the Tory Lord Heseltine, as he now is, who said that to help British business he would
“intervene before breakfast, before lunch, before tea and before dinner. And…get up next morning to start again.”
Might the Minister not regret the fact that she did not save steelmaking on Teesside, which would have been far better for our national economy than the package that she has announced today?
Anna Soubry
Obviously, the hon. Gentleman will not have access to all the television interviews that I did at the time. If I had a magic wand, the simple answer would be, “Absolutely, yes”, but the harsh reality is that we have slab falling by half its price, overproduction, under-consumption and a steel plant losing half a billion in five years. That is the harsh reality, and it would not be fair on his constituents if we were to try to bail out Britain’s steel industry, which would probably cost £1 billion a year.
Business of the House
(8 years, 6 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Chris Bryant (Rhondda) (Lab)
Will the Leader of the House give us the business for next week?
The Leader of the House of Commons (Chris Grayling)
The business for the week commencing 19 October will be as follows:
Monday 19 October—Second Reading of the Psychoactive Substances Bill [Lords]. I also expect my right hon. Friend the Prime Minister to make a statement following the European Council.
Tuesday 20 October—Opposition day (7th allotted day). There will be a debate on tax credits on an Opposition motion.
Wednesday 21 October—Consideration in Committee of the Cities and Local Government Devolution Bill [Lords] (day 1).
Thursday 22 October—A motion to approve standing orders relating to English votes for English laws.
Friday 23 October—Private Members’ Bills.
The provisional business for the week commencing 26 October will include:
Monday 26 October—Remaining stages of the Finance Bill.
I should also like to inform the House about some debates to be held in Westminster Hall.
Monday 19 October—Debate on an e-petition relating to immigration.
Tuesday 20 October—Debate on the availability of cancer drugs.
Thursday 22 October—General debate on the conflict in Yemen, followed by a debate on fire safety measures in school buildings.
Monday 26 October—Debate on an e-petition relating to term-time leave from school for holidays.
As you heard, Mr Speaker, I announced that next Thursday we will be debating and voting on the Government’s proposals to allow for English votes for English laws. I should just inform right hon. and hon. Members that I have this morning published updated proposals for changes to the Standing Orders, reflecting the discussions and feedback I have had since July, as well as the letter I received from the Procedure Committee in September, which is published on its website. The revisions are clearly indicated in the new document. I have published these proposals today to give the House further time to consider them before the debate. I am also conscious that the Procedure Committee is due to report on Monday, and I will not be tabling the final proposed Standing Order changes until I have read that report and been able to make any final changes before we table them, probably on Monday night.
Chris Bryant
We should first pay tribute to two great men who have died since the last business questions: Denis Healey, the greatest Prime Minister this country never had, a man who showed that politicians need never be automata; and Geoffrey Howe, a man I had the great honour to know closely because of all the campaigning work we did together to keep Britain at the heart of Europe. As Robin Cook once quipped, because Geoffrey had been knighted and made a peer, and his lovely wife Elspeth had been made a Baroness, she was “once, twice, three times a lady”. That is a tribute to Robin Cook, too.
Deep in the bowels of the parliamentary estate lies a small, sweaty airless room where people go to spin. It is in the gym, and it is called the John Bercow spin studio! I have never seen the Leader of the House in the gym—I do not suppose anybody has—but it seems clear that his colleagues have been spending a great deal of time in the spin studio.
When the Prime Minister was asked yesterday when exactly he knew about Lord Ashcroft’s tax status, he started spinning away like a top, stuck his fingers in his ears and simply refused to answer. It got even worse later in the day when his official spokesman was asked precisely the same question 11 times—yes, 11 times—but answer came there none. Silence; tumbleweed. Can the Leader of the House therefore tell us when precisely the Prime Minister learned about Lord Ashcroft’s tax status? Was it as the Prime Minister declared in this House, or was it as Lord Ashcroft declared in his book? I know that the Leader of the House does not like books—for prisoners or anybody else—but there we are.
One might have thought that it was perfectly reasonable to ask the British Minister with responsibility for Syrian refugees how many Syrian refugees had come to Britain. One might have thought that it was the one thing that that Minister would know, but when he was asked this simple question seven times—yes, seven times—by the Home Affairs Select Committee, he refused to answer point blank. He even maintained that he knew the answer, but just did not want to tell anyone—like an eight-year-old hiding his homework from his older sister. So can the Leader of the House now tell us how many Syrian refugees have come to Britain?
Can the right hon. Gentleman tell us when we will have a proper debate on Syria? The country, to be honest, is crying out for leadership on this issue. The Prime Minister seems to think that a consensus will miraculously develop on what the UK’s response should be. We have heard press briefing after press briefing, but millions of people have been displaced, thousands have lost their lives—thanks to Putin, Assad and ISIL—and all the while, the UK’s diplomatic, humanitarian and military policy on Syria remains a blank page. So when will the Government come to the House with a proper plan of action on Syria?
Mr Speaker, it is clear that the Government’s
“changes to tax credits have been somewhat under-scrutinised. The changes are both eye-wateringly painful to those affected, but also reverse a key policy platform of the last five years—namely, making work pay.”
Those are not my words, but those of the hon. Member for Aberconwy (Guto Bebb), a Conservative Member, and he is absolutely right. Millions of working people are terrified of what will happen to their family finances next year. About 3.2 million families will be hit. A two-parent family with one adult working full time and the other doing 20 hours a week on the minimum wage will get a £1,100 annual pay rise, but even after that, will be £1,800 worse off and out of pocket. We all know that the Government are going to back down in the end on this issue, so will they just get a move on? Will the Leader of the House be the champion of this House and fight for a change on the tax credits cuts.
Yesterday, the Government were quite exceptionally defeated in the Lords on a motion condemning the mandatory court charges that were introduced by the right hon. Gentleman when he was the Injustice—sorry, Justice Secretary. One magistrate has written to me to say that because of these mandatory charges, many innocent people are pleading guilty. He says that he recently had to impose—he had to, because it is mandatory on the magistrates—the court charge of £150 on a homeless man who had stolen a £1.90 sandwich from Sainsbury’s. That is not the rule of law; it is cruel injustice.
The new Justice Secretary has already overturned the Leader of the House’s ban on books for prisoners. He has put a halt on the right hon. Gentleman’s plan to build Saudi Arabia’s jails and execution centres, and we read in the press today that the new Justice Secretary is now going to beat a retreat on these cruel mandatory court charges. Just in case the Leader of the House is to be completely airbrushed from history, can we have a debate on his legacy as former Justice Secretary? It need not be a very long debate.
The Leader of the House has announced that we will debate his EVEL—English votes for English laws—proposals next Thursday. I still believe that they are a dog’s breakfast. However, during the last session of business questions I asked the Leader of the House whether he had any intention of replying to the Lords message asking for a Joint Committee to be set up before the measures were voted on. It is exceptional for the House of Commons not to reply to such a message from their lordships. The Leader of the House chose not to reply, either to me in the House or to their lordships subsequently.
I know the right hon. Gentleman’s old school, the Royal Grammar School in High Wycombe, extremely well. When I was curate of the parish church I used to prepare the boys for confirmation at that school, so I know that they are taught good manners. Is it not time that the Leader of the House remembered his old RGS High Wycombe school lessons, and gave the Members of the House of Lords a proper response? Should he not reply, “Yes, we will not implement these changes until a Joint Committee of both Houses has been set up”?
Let me say finally that I am sure the whole House—every single Member—will want to wish Wales, Scotland and Ireland well in the rugby world cup this weekend, but especially Wales.
Chris Grayling
Let me begin by echoing the hon. Gentleman’s words about Denis Healey and Geoffrey Howe. They were two towering figures in the House, and they made a massive contribution to the national life of the country. They will be sorely missed by their families, their former colleagues, and all parliamentarians.
Let me also pay tribute to the hon. Gentleman. Last week, he was responsible for ensuring that three new plaques were placed on the wall of the Chamber for three Members who died in the first world war. It is absolutely appropriate that we remember parliamentarians who have given their lives in the interests of this country, and I commend the hon. Gentleman for doing that.
I hope the House will also remember that a service is being held in the chapel today, and I hope that, straight after business questions, you and I will go down there together, Mr Speaker. The service is being held to celebrate the life of Ian Gow, who, rightly, has a shield at the end of the Chamber—another man who gave his life in the service of this country. We remember him today as well.
The hon. Gentleman could perhaps be described as a beacon of stability in his party this week, and I commend him for that. He is a ship that is sailing steadily forward in a party that otherwise seems to be slightly on the chaotic side. Yesterday the shadow Chancellor announced five times his embarrassment at the U-turn that we had experienced. Moreover, during an interview on Channel 4 News—I do not know whether you saw it, Mr Speaker—the shadow City Minister first admitted that he had no idea what the deficit was, and then, after prolonged questioning, said that he had no idea when, or indeed whether, he had been able to go to the City. In fact, he had not been there at all.
The hon. Gentleman talked about spin, and about the John Bercow spin studio. I am afraid that, actually, the spin lessons in the House of Commons came from the Labour party when it was in government. The present Government have set out a clear plan, and this week we are implementing it. The hon. Gentleman talked about English votes for English laws. English votes for English laws was a manifesto commitment which we are implementing. Yesterday we debated devolution measures for England and Wales, a manifesto commitment which we are implementing. On Tuesday we debated the Immigration Bill, a manifesto commitment which we are implementing. So I will take no lessons from the Labour party about spin. This is a Government who are delivering what they promised.
The hon. Gentleman asked about Syria. We all take the situation in Syria enormously seriously. It is tragic and distressing beyond belief to see a country in such a state of chaos and ruins, and to see the human cost. I remind the hon. Gentleman, however, that we debated the subject for several days in September, and we will undoubtedly return to it when we need to. It is a matter that will be constantly in the minds of Ministers and the House, and we will continue to debate and discuss it at the appropriate moments.
The hon. Gentleman talked about the availability of time for a debate on tax credits. Again, I remind him that we had five days of debate on the subject following the summer Budget in July. He asked about English votes and the Lords message. He will have to wait for the debate next week, when I shall set out exactly how we plan to respond to all the issues that have been raised during the last few weeks and months.
The hon. Gentleman also asked about my legacy as Justice Secretary. I remind him that when the Labour party was in power—for 13 long years—if you had been in prison for less than 12 months, when you left you walked out of the door of that prison with £46 in your pocket and nothing else: no support, no guidance, nothing. It was shocking, it was a disgrace, and in all the years when the Labour Government had the money to do something about it, they did not. Well, as of last February, following the “Transforming rehabilitation” reforms, every single prisoner who leaves our jails will receive, for a minimum of a year, support, supervision and guidance. That is a massive change. It is a change I am proud of. It is a change that did not happen under the previous Government. It is a legacy that will be part of the social change that I think will mark the future view of this Government and what they achieved.
Finally, I echo the hon. Gentleman’s comments about the rugby world cup. In particular I offer my good wishes to Wales. May they do to Australia what unfortunately England were unable to do.
Mr Charles Walker (Broxbourne) (Con)
May I first thank the Leader of the House for his open and straightforward dealings with me as Chairman of the Procedure Committee? May I urge him, at this late stage, when he receives an embargoed copy of the Procedure Committee report tomorrow to seriously consider all our recommendations? They are not made lightly and I believe they will significantly improve the proposals in relation to English votes for English laws.
Chris Grayling
First, I thank my hon. Friend and all the members of the Procedure Committee. What I sought to do after the debates in the summer was respond to the requests of the House. We provided additional debating time and time for the Committee to look at these issues. I am grateful to my hon. Friend for the collaborative way in which he has worked with me. He is bringing forward new ideas challenging the proposals, but it has been a productive discussion. I can tell the House today that I have already taken on board some of the recommendations to me in the letter that came from the Committee in September, and I shall be reading the report very carefully when it arrives on my desk tomorrow.
Pete Wishart (Perth and North Perthshire) (SNP)
I thank the Leader of the House for announcing the business for next week. May I too pay tribute to Geoffrey Howe and Denis Healey? I grew up in the 1970s when they were the absolute giants of this House, and many of us of that generation will remember them very fondly. I also thank the shadow Leader of the House for the three magnificent plaques we now have in the House. They are a fantastic addition.
We are back here after what is called the “conference recess”, but the third party of the United Kingdom is starting its conference today, which makes a mockery of the concept of the conference recess. Mr Speaker, I think that you, the Leader of the House and other interested parties should look long and hard at how we are organising the recesses over the summer period. That would find great support throughout the House.
Of course, we found out several things of course during the conference recess, some of them almost bizarre and utterly unmentionable, including the fact that the Leader of the House, probably in what is not a bizarre intervention, may possibly be seeking the leadership of the Conservative party. Apparently he will be the unity candidate for the Eurosceptics. I wish him good luck in that endeavour.
Next week we conclude the sorry saga of English votes for English laws. Over the past few months the Leader of the House has managed to convince absolutely no one, outwith the ranks of the Conservative party. The idea is opposed by every party in this House. It is opposed by every single legislative Assembly and Parliament in the whole of the UK. It is even opposed by the unelected cronies and donors from down the corridor, and the Leader of the House knows very well the views of Scottish MPs on this. I just wish he would have a quiet word with the leader of the Scottish Conservatives, Ruth Davidson. Support for the Scottish Conservatives stands at about 12% in the opinion polls at present, and once they make Scottish MPs second-class MPs we can expect it to fall still further.
Yesterday, in points of order following Prime Minister’s questions, some very disturbing points were made on the ruling of the Investigatory Powers Tribunal on the Wilson doctrine. Several of us were incredulous at what was said: that it has no legal force and is nothing other than an ambiguous political statement, directly contradicting what the Prime Minister said on this issue only a few weeks ago. We absolutely require an urgent debate on this issue. I hope the Leader of the House will support any such initiative so that this is brought to the Floor of the House and we can hear from the Prime Minister exactly what he meant when he made that statement a few short weeks ago. We must approach this in a spirit of honesty, openness and transparency. I hope the whole House will support any initiative to ensure we get a debate on the Wilson doctrine and the worrying allegations that MPs are being spied on.
Lastly, the Government got their fiscal charter through last night. Congratulations to the Conservatives for once again, through their measures, picking on the poorest and most marginal and vulnerable in our community. Last night we saw three positions: the Conservatives’ position, backing the fiscal charter; the SNP position, opposing it with most of the Labour party supporting us; and there was a rebellious abstention, which I have never heard of in this House. I say to the Leader of the House and the Labour party that they will find those on the SNP Benches resolute in the objective of opposing the Tories. We hope the Labour party will unite and join us in that mission.
Chris Grayling
May I start by thanking the hon. Gentleman for his comments about Denis Healey and Geoffrey Howe and telling him how much we all regret keeping him away from his conference today? I am sure that he will be jumping on a train as soon as business questions are over and heading off to have a great time with his delegate colleagues.
The hon. Gentleman raised the issue of English votes for English laws. I must gently chide him on the way in which he and his party are approaching this matter. They keep coming up with the line that they will be excluded from certain votes as a result of the proposal. He knows, and I know, that that is not the case. What is more, he knows that I would not do that to him anyway. Although we spar across the Chamber, I have a great regard for him and we get on very well. Perhaps one day we will get to walk through the Division Lobby together—I know this is theoretical; it has not happened yet—and I would not dream of taking that opportunity away from either of us. Let me assure him again that on no occasion will he be excluded from a vote that he is currently able to take part in in this Chamber. That is really important for both of us and for our relationship.
The hon. Gentleman made a more serious point about the ruling in the court case yesterday. I remind him that two clear messages emerged from that case. First, the case was not successful; the court upheld the current situation. Secondly, it was made clear that all the activity was within the law. As Leader of the House, I take these issues very seriously and I would not be happy with the House being treated inappropriately. My ministerial colleagues and I will be keeping a careful watch over the matter.
The hon. Gentleman mentioned the fiscal charter. Again I pay tribute to him: he is right to say that over the past few weeks the Scottish National party has formed a united front, voted consistently and behaved as one. He is also right to point out that the same cannot exactly be said of the Labour party. After last night, it is difficult to see where Labour is going. I am not sure what its policies are now, or whether a leadership coup is being planned for the near future. Of course, the shadow Leader of the House, the hon. Member for Rhondda (Chris Bryant), has a track record in that regard. He was the person who pulled the trigger when Tony Blair went, and he was instrumental in pushing Gordon Brown out. Maybe it will be third time lucky—or unlucky, depending on where in the House you are sitting.
Several hon. Members rose—
Mr Speaker
Order. I am looking to conclude business questions by 11.45, so if we are to accommodate everyone, we must have very short questions and answers.
Mr Peter Bone (Wellingborough) (Con)
At 4.25 pm yesterday in Westminster Hall, a unique event took place. For the first time, a question in Westminster Hall was not agreed to. Under subsection (13) of Standing Order No. 10, a motion should be brought to the House in those circumstances so that the House can then vote on it without further debate. I listened carefully when the Leader of the House announced the business for next week, but I did not hear him mention any such motion. Was that an omission that he would like to correct now?
Chris Grayling
I am aware of what took place yesterday, and I will be happy to discuss the matter with the Clerks and to write to my hon. Friend.
Ian Mearns (Gateshead) (Lab)
I thank the Leader of the House for the business statement. Members will be aware that we resumed on Monday following the conference recess with heavily subscribed debates on superfast broadband and the political situation at Stormont. The time available for those debates was curtailed, however, as a result of statements being made before the Back-Bench business commenced. I note that there was no mention in today’s business statement of any dates being allocated for Back-Bench business. I understand there is a possibility that 29 October will be allocated for that purpose, but that has not been confirmed. Will the Leader of the House confirm the next dates for Back-Bench business debates in the Chamber as soon as possible?
Chris Grayling
I will always seek to be as helpful as possible to the House and to the hon. Gentleman, and I can assure him that we will let him know the next dates as soon as possible and as far in advance as possible.
Chloe Smith (Norwich North) (Con)
In two Bills before the House—the European Union Referendum Bill and the Cities and Local Government Devolution Bill—amendments have been proposed both by this place and the other place to refer to a change in the age of the franchise. Does the Leader of the House agree with me that we should approach this debate properly and pay it proper attention rather than dealing with it piecemeal under other Bills?
Chris Grayling
I pay tribute to my hon. Friend for the work that she is doing in and around youth engagement, which is very important to all of us from all parts of the House. Undoubtedly, this will be debated seriously, as indeed it should be because it is a very real issue, given the fact that 16 and 17-year-olds have the vote in Scotland. There are different views in this House, so of course the matter should be given the proper attention that it deserves.
Keith Vaz (Leicester East) (Lab)
Last week, the Tunisian national dialogue quartet received the Nobel prize for peace, but that country faces huge economic difficulties, especially in the tourism industry, in part owing to the travel advice of our Foreign Office. May we have an urgent debate or a statement on what we can do to help Tunisia, especially with regard to tourism?
Chris Grayling
We all have the greatest admiration for the prize winners in Tunisia and for all those who have worked so hard to make Tunisia a stable and peaceful country. The decision of the Foreign Office was taken with a heavy heart, because we understand the implications of it, but we also have a duty to look after the safety of British holidaymakers. The Foreign Secretary will be here on Tuesday, and I will ensure that he is aware of the right hon. Gentleman’s concern. This is a matter that will be under continuous review, as we all want to do the right thing by Tunisia.
Philip Davies (Shipley) (Con)
The Prime Minister said that the whole focus of the Government will be on implementing the Conservative manifesto of the last election. That manifesto said that we would toughen sentencing and create a victims law. From what I have seen so far, perhaps it would be helpful if the Leader of the House introduced the new Secretary of State for Justice to the manifesto. Will the Leader of the House tell us when the Government will bring forward their proposals from the manifesto to toughen sentencing and create a victims law?
Chris Grayling
The victims law is an important part of what we brought forward at the election. I can assure my hon. Friend that the intention of the Government is to fulfil their manifesto in full. We have a lot of business to get through, but I have no doubt that we will move on to that soon, and that it will make a difference.
Mr Graham Allen (Nottingham North) (Lab)
Among the remaining orders on the Order Paper, the Leader of the House will see that there is a motion signed by Members of all parties saying that this House concurs with the Lords Message that a joint committee be set up to look at the constitutional implications of English votes for English laws. It is 104 years since this House has refused to acknowledge or answer a message from the House of Lords. Will the Leader of the House ensure that when the English votes for English laws proposals come forward next week an answer to that message is made very clear to their lordships?
Chris Grayling
When we come to this issue next week, I will have acted on that message. I remind the hon. Gentleman that this is a debate about the Standing Orders of the House of Commons and it would be quite a big step for us to take a move towards inviting the House of Lords to rule, consider and act on our own Standing Orders.
Dr Matthew Offord (Hendon) (Con)
Given the 20% increase in the number of reported hate crimes in the past year, will a Minister come to the Dispatch Box to explain why the Metropolitan police have written to me to say that they do not consider it necessary to take legal action against identified individuals who were protesting outside Downing Street on 9 September when a mob was waving Hezbollah flags, shouting anti-Semitic remarks and making anti-Semitic gestures?
Chris Grayling
Let us be clear: hate crime is unacceptable in our society. Anti-Semitic behaviour is unacceptable in our society, as is the reverse, which is when we sometimes see hostile actions taken against mosques in this country. This is an issue that my hon. Friend should raise on the occasions that are available to him with both the Home Secretary and the Prime Minister. All of us agree that this is something that should be acted on; it is not acceptable and we would always wish to see the police take strong action when such behaviour occurs.
Ian Paisley (North Antrim) (DUP)
I wish to be associated with the comments made by the Leader of the House about the memorial to Ian Gow. We have a service of thanksgiving today to commemorate his murder by Irish terrorists 25 years ago. I hope as many Members as possible will join us in St Mary Undercroft for that service.
On an equally important matter, police recruitment in Northern Ireland has been disrupted in the past two weeks by bomb attacks on the recruitment centre. It is quite unbelievable. No other police recruitment centre in these islands faces bomb attacks when young people try to sign up for public service. Will the Leader of the House bring forward a statement on additional resources that the police in Northern Ireland will have available to them to combat those attacks?
Chris Grayling
Of course, we have just had Northern Ireland questions, but I will ensure that that concern is passed to my colleague the Secretary of State. What the hon. Gentleman has just described is absolutely unacceptable in our country and should never be tolerated in any way, shape or form. Those who express support for terrorist actions are not only utterly misguided but out of place in a democratic society and should be ashamed of their views. In my view, what he has just described underlines the need for the parties in Northern Ireland to continue the dialogue they are engaged in. We need to work our way through the current difficulties to secure a stable future for Northern Ireland in all respects and to ensure that what we have seen in the past can never return.
Tom Pursglove (Corby) (Con)
Sue Wathen, one of my constituents, is experiencing terrible difficulties in trying to access treatment for a condition caused by contaminated blood. I know that Members on both sides of the House have constituents who are facing similar difficulties, so may we have a debate in Government time on this tragedy? We need action.
Chris Grayling
I know that this issue concerns Members on both sides of the House and is a matter of concern to the Secretary of State, so I am worried to hear that my hon. Friend’s constituent is having those difficulties. If my hon. Friend wants to contact me after questions, I will ensure that his concerns are passed on to the Secretary of State. These things are probably subject to local decision making, but we should all be concerned if people who have been through a terrible experience are not getting the support they need.
Valerie Vaz (Walsall South) (Lab)
Given the Care Quality Commission’s report on hospital safety and the £3.3 billion bill for NHS temporary staff, may we have an urgent debate on the skills shortage in the NHS? The University of Wolverhampton, some of which is in my constituency, has said that it has had 5,000 applications for 500 nursing places. Supply could easily meet demand locally without having to go abroad.
Chris Grayling
I am well aware of the pressures in different parts of the health service and I pay tribute to our healthcare professionals. We are announcing measures today to try to ease pressures on nursing. In my view, today’s CQC report is a positive in that it is part of a drive by this Government to push up standards. If we do not look at where challenges remain to be addressed, we will never be able to address them. Fantastic care is provided across many parts of the national health service, but where it is not fulfilling its full potential we obviously have to know about it and work to improve it.
John Howell (Henley) (Con)
There has been a dramatic escalation in violence across Israel and the west bank over recent weeks, so may we please have a debate on this serious issue?
Chris Grayling
I think we are all concerned about what is happening in Israel and the west bank. Utterly unacceptable incidents have taken place, including stabbings out of the blue and other incidents that have led to death and serious injury. We need to be constantly aware of that in this country and use every opportunity to try to facilitate talks and peace between the two sides. Obviously, I will ensure that my right hon. Friend the Foreign Secretary addresses the issue in this House before too long.
Steven Paterson (Stirling) (SNP)
Yesterday I attended a reception organised by Citizens Advice Scotland about the barriers facing Scotland’s rural customers. It has produced an excellent report that is well worth a read, and one part that caught my eye was the section on rural banking provision, which lists the difficulties facing rural areas and villages. I am sure that the situation is the same in constituencies across the country. May we have a debate on the issues facing rural communities with banking and other services, such as post offices?
Chris Grayling
We have to work to protect services in rural areas. It is vital that we do, and I hope and believe that the additional powers being provided to the Scottish Parliament through the Scotland Bill will give the Scottish Government greater ability to deal with the challenges the hon. Gentleman has described in his constituency.
Jeremy Lefroy (Stafford) (Con)
The National Institute for Health and Care Excellence recommends three rounds of in vitro fertilisation on the NHS, but my clinical commissioning group and many others can afford only one or two. May we have a debate on whether the commissioning of IVF should be transferred to NHS England so that we can have a standard, fair number of IVF rounds across the country?
Chris Grayling
I understand my hon. Friend’s concerns, but of course there will always be differences in provision in different parts of the country under a system in which we offer power and decision-making responsibilities to local doctors. I suggest that he look to secure an Adjournment debate on the subject, as I know that it will be a matter of concern to my friends in the Department of Health.
Jim Fitzpatrick (Poplar and Limehouse) (Lab)
The Royal Borough of Greenwich and the Mayor of London have approved a planning application for a cruise terminal at Enderby Wharf on the Thames, despite the absence of the provision of a shore to ship energy supply, which would prevent ships from having to use their diesel engines for power while they are berthed there. Has the Leader of the House had any indication from the Department for Communities and Local Government that it will be making a statement calling in this application for a proper examination of the impact on air quality in London?
Chris Grayling
I am sure the hon. Gentleman’s concerns have been heard. He has made his case eloquently. This is a detailed planning matter that would have to be handled in the usual way by Ministers, but I am sure his comments have been noted.
Mark Pawsey (Rugby) (Con)
Parents in Rugby were delighted when our new free school opened in September, providing additional choice and extra places, but they have been very concerned this week when, for the second time in a short period, a Traveller encampment has been set up at the entrance on the public highway to the school. May we have a debate about additional powers for local authorities to deal with encampments where they occur in sensitive areas, such as around schools? Perhaps some consideration can be given to how we fund defensive measures such as bollards to prevent such encampments.
Chris Grayling
My hon. Friend makes an important point. In my experience in Surrey, police and local authorities have more powers than they sometimes realise. If they use those powers effectively, they should be able to move those encampments on quickly. They need to do that, and I encourage my hon. Friend to put pressure on both those organisations locally to make sure that they get on with it.
Angela Rayner (Ashton-under-Lyne) (Lab)
I bobbed furiously yesterday in Prime Minister’s questions, such is the importance of this matter. The national media recently reported the findings of a coroner’s report on a young man from my constituency named Kane. He was the same age as my son, who is 18, and he killed himself because Wonga cleared all the money from his account. May we have an urgent debate so that this cannot happen again? These companies should not be allowed to leave someone—our children—so destitute.
Chris Grayling
It is tragic when anybody takes their life, but particularly when someone so young does so. The point that the hon. Lady makes is a valid one. I encourage her to apply for an Adjournment debate so that she can put this point directly to my colleagues at the Business Department.
Will Quince (Colchester) (Con)
We are fortunate in Colchester to have two of the best grammar schools in the country, and I was delighted to hear the announcement that the Government will imminently approve a new grammar school in Sevenoaks. May we have a debate on the Government’s policy on grammar schools and whether we can open any more during this Parliament?
Chris Grayling
It is important to say that the decision taken by my right hon. Friend the Secretary of State for Education involves the expansion of a successful school. If that expansion goes ahead, it will mean that a successful school will be able to offer more places to more students, but it is the expansion of a successful school. Our policy is always to ensure that every successful school—grammar school, academy or otherwise—is able to expand to offer places to young people who need that support.
Toby Perkins (Chesterfield) (Lab)
In Chesterfield over the past few years we have been conscious of the huge difficulties in accessing GP appointments. The Government’s policy, which seems to suggest that GP contracts are over-generous at a time when the country is desperately struggling to attract GPs, and the moves that they are taking in relation to junior doctors, which are discouraging people from pursuing a career in that field, make the problems worse. May we have a debate in Government time to ascertain what the Government’s strategy is to improve access to GP appointments?
Chris Grayling
My right hon. Friend the Health Secretary was in the House on Tuesday answering questions. It is his policy to encourage the development of a seven-day NHS to improve access to GP services. He is working with the relevant representative groups on plans for employment structures for junior hospital doctors to ensure that we provide the right framework for that to happen, and also to provide the right support for our junior doctors.
Oliver Colvile (Plymouth, Sutton and Devonport) (Con)
Tomorrow afternoon I will be attending the unveiling of a plaque to commemorate Napoleon Bonaparte’s sojourn on HMS Bellerophon in Plymouth Sound, following his defeat at Waterloo 200 years ago. Will my right hon. Friend join me in congratulating and thanking Alain Sibiril, who is the French honorary consul in Plymouth, who has organised this event? May we have a debate on the entente cordiale?
Chris Grayling
In this country we always try to welcome our French friends with open arms. It is quite unusual for them to be detained in a ship offshore. They are otherwise welcome to come here as part of an entente cordiale that, happily, has lasted 100 years. It is quite a long time since we had a conflict with the French, and long may that continue. I pay tribute to my hon. Friend, as I know that this is not the only historic event that he is involved in. He is also involved in the celebrations of the sailing of the Mayflower, another important occasion to mark in the history of this country, and I commend him for it.
Kirsten Oswald (East Renfrewshire) (SNP)
May we have a statement on the plight of six merchant seamen, including my constituent William Irving, who have been detained in Chennai for over two years on charges of piracy and are now undergoing their second trial? If they are again released following the trial, will the Government commit to securing their return home as soon as possible?
Chris Grayling
We always try to provide proper consular support to people who are charged abroad and ensure that they are treated fairly and justly by overseas justice systems. I encourage the hon. Lady to raise the case with Foreign Office Ministers when they are here next Tuesday, because I know that they will try to do the right thing.
Nigel Huddleston (Mid Worcestershire) (Con)
Just 6% of mobile phone users change contracts each year, and more than half the population have never changed carriers. According to the consumer group Which?, that means consumers are paying more than £5 billion a year more than necessary because 70% of people are on the wrong contract. Will my right hon. Friend find time for a debate on ways in which mobile network operators could better communicate the best available deals to their customers?
Chris Grayling
That issue was addressed in our manifesto, and I know that the Department for Culture, Media and Sport is currently looking at it and hopefully will shortly take steps to enhance what we do shortly. I encourage my hon. Friend to seek to bring the matter before the House, either through the Backbench Business Committee or in an Adjournment debate, because I think it is very important.
Paula Sherriff (Dewsbury) (Lab)
In the Finance Bill Committee we recently discussed the issue of VAT on female sanitary hygiene products. The Financial Secretary told us that it was a matter of European legislation. Therefore, may we have a debate on the Government’s strategy for negotiating a zero rate as part of the Prime Minister’s talks on our EU membership before the referendum?
Chris Grayling
I think there will be many occasions to discuss our relationship with the EU over the next few months—indeed, we have done so with the European Union Referendum Bill. The hon. Lady makes an interesting point that I know she will want to make in those debates, or during Foreign Office questions next week.
John Glen (Salisbury) (Con)
Anni Nasheed is the first ever democratically elected President of the Maldives, yet he has been sentenced to 13 years in prison for terrorism. The UN working group on arbitrary detention has found that unlawful on three counts and urged for his immediate release. Will the Leader of the House find time for a statement from a Foreign Office Minister to explain what the British Government are going to do, including the possibility of sanctions, to ensure that he is released as soon as possible?
Chris Grayling
I know that the United Nations has looked at that matter closely. The Government are extremely concerned about what has happened in the Maldives and want to see the issue addressed. The Foreign Secretary will be here next Tuesday for Foreign Office questions, so I encourage my hon. Friend to take advantage of that opportunity. We should always stand up when political leaders are imprisoned inappropriately. We should be, as we always have been, a beacon of liberty for political protesters suffering in that way.
Liz McInnes (Heywood and Middleton) (Lab)
Like my hon. Friend the Member for Walsall South (Valerie Vaz), I would like to request an urgent debate on today’s report from the Care Quality Commission, which states that two thirds of our hospitals are offering substandard care, that one in eight are rated as inadequate for safety and that three quarters overall are rated as requiring improvement.
Chris Grayling
As I said earlier, the reason we have the new regime, and why we go through these performance assessments, is precisely so that we can drive up quality and performance. Where hospitals have been put in special measures as a result of the CQC’s work, we have seen measurable improvements in the quality of care, which is something we should all welcome.
Bob Blackman (Harrow East) (Con)
Harrow Council has announced its intention to impose a £75 charge for the collection of garden waste. This back-door council tax increase for a monopoly service is likely to be the most expensive in London, and possibly in the whole country. May we therefore have an urgent debate in Government time on councils imposing additional charges for monopoly services that the public have no choice but to accept?
Chris Grayling
My hon. Friend highlights the risk of monopoly services generally. We should always seek to deliver choice in the public sector where we possibly can. Seeking to offer consumers choice has been part of what this Government, and indeed our party, have done for a very long time. I understand that the situation he describes must be hugely frustrating locally. I know that he, as a powerful advocate for his area, will be biting at the council’s ankles for what it is doing.
Greg Mulholland (Leeds North West) (LD)
I am sure that the Leader of the House will want to join me in praising Leeds business week—the UK’s biggest week-long business event, bringing businesses, entrepreneurs, the private sector and the third sector together to discuss business issues. May we have a debate on how the Government’s devolution proposals, currently somewhat confused with the different options in Yorkshire, will affect businesses so that they have a clear idea of what to support?
Chris Grayling
We very much hope that our devolution proposals, with the plans that are coming through—we had a Second Reading earlier this week and we have a debate in Committee on the Floor of the House next week—will provide a real opportunity for partnership between local authorities and businesses to drive up the economic performance of our cities and our regions. I encourage the hon. Gentleman to take part in the debate next week. He makes an important point and I am sure that Ministers will listen to it.
Andrew Stephenson (Pendle) (Con)
On Saturday it was great to see the last flying Vulcan bomber fly over Rolls-Royce in Barnoldswick as part of its farewell tour of our country. My family have very close ties with this iconic aircraft; four members of my family, including my father, worked for A.V. Roe and Company, which designed and built the aircraft. Will the Leader of the House grant us a debate where we could pay tribute to Vulcan to the Sky, the charity that has kept the plane flying, and the remarkable farewell tour across the UK that has delighted thousands of spectators?
Chris Grayling
I pay tribute to my hon. Friend and his family for their involvement in an iconic aircraft in the history of this country. He must be very proud that they have played a part in its construction. For so much of our heritage, we rely on groups of volunteers who give up their time to protect for future generations what has been. He describes a very important group of those volunteers who are doing a great job; I commend them for it.
Andrew Gwynne (Denton and Reddish) (Lab)
Changes to the state pension as part of the Pensions Act 1995 and the Pensions Act 2011 have adversely impacted, not just once but twice, on a number of women born in the 1950s. May we have an urgent debate in Government time to discuss the impact of those pension changes on women born in the 1950s and potentially look at solutions to put right the injustices?
Chris Grayling
These issues have been debated in this House extensively over the years. Yes, there are difficult decisions to take when deciding to raise the state pension and having to set a framework within which to do that. These decisions were taken under Governments of both parties. We have all recognised the need to increase the state pension age and the logic of equalising the pension age between men and women, and we have tried to do that in as sensitive a way as possible. It has been extensively debated in this House, but I do not think we could move to further changes now.
Margaret Ferrier (Rutherglen and Hamilton West) (SNP)
The continued retention of weapons of mass destruction for the UK is of grave concern to millions of people, not least in Scotland, where people live in their shadow. This issue is much too important to be about gaining advantage at an election, as has been suggested. Will the Leader of the House ask for a statement from the Secretary of State for Defence on the timing of the vote on the Trident replacement?
Chris Grayling
We will bring this issue before the House in due course. I appreciate that Scottish National party Members feel strongly about it. What I have never been quite able to understand is why, since the nuclear deterrent is such an important part of the Scottish economy, they want to see it go.
Mr Speaker
I have been preserving the hon. Gentleman, who is a specialist delicacy in the House, to be savoured at the end.
Jim Shannon
Thank you, Mr Speaker.
One recent health issue has been the increase in type 1 diabetes. Many schemes have been put forward to address that, including dose adjustment for normal eating, which controls carbohydrates in tandem with physical exercise. Will the Leader of the House agree to a statement or a debate in the House on type 1 diabetes and how to address it?
Chris Grayling
That condition affects very large numbers of people, and we would wish health research to continue to try to alleviate the burden that people face. The subject is absolutely right for requesting an Adjournment debate or asking the Backbench Business Committee to bring forward a debate, and I encourage the hon. Gentleman to do so.
Point of Order
(8 years, 6 months ago)
Commons ChamberRead Full debate Read Hansard Text
Philip Davies (Shipley) (Con)
On a point of order, Mr Speaker. In business questions, the hon. Member for Perth and North Perthshire (Pete Wishart) mentioned the conference season. Surely it is unacceptable in this day and age that Parliament goes for three weeks without any scrutiny of the Government. Surely the political parties can organise their conferences at weekends so that Parliament can continue to sit. Is there anything that you can do to help to facilitate this and to make the political parties have their conferences at weekends so that the House can continue to scrutinise the Government during that period?
Mr Speaker
I thank the hon. Gentleman for his point of order, of which I had no advance notice, but about which fact I make no complaint whatever. I simply say to him the following: first, at the moment it is a matter for the parties, though potentially it could be the subject of a resolution by the House.
Secondly, I think that there is a psychic quality about the hon. Gentleman, because I have, in very recent days, penned words on this very matter that might appear in an organ of note within the House soon. As so often, I find myself very much in agreement with the hon. Gentleman. This is our main place of work. This is where people expect us to be. The idea that, because voluntary organisations choose to hold a voluntary gathering, we should absent ourselves from our main place of work for three weeks has long struck me as incongruous. It appears that it also strikes the Scottish National party as incongruous, as it seems perfectly capable of organising a substantial conference on a Thursday, Friday and Saturday, thereby not necessitating a further week of absenting from parliamentary business. I think I had better leave it there for now.
Wilson Doctrine
(8 years, 6 months ago)
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Chris Bryant (Rhondda) (Lab)
I seek leave to propose that the House should debate a specific and important matter that should have urgent consideration, namely the operation of the Wilson doctrine.
The right of Members of this House to be able to represent their constituents without fear or favour is intrinsic to our democracy. It is the cornerstone of the Bill of Rights and one of the most ancient freedoms of this country. In another era, before the existence of telephones and emails, it meant that MPs and peers, even in times of war, had the right for their written correspondence not to be intercepted or interfered with.
Since 17 November 1966, Members have relied on the words of Harold Wilson, the then Prime Minister, who said that he had instructed
“that there was to be no tapping of the telephones of the Members of Parliament. That was our decision and that was our policy.”
He added:
“But if there was any development of a kind which required a change in the general policy, I would, at such moment as seemed compatible with the security of the country, on my own initiative make a statement in the House about it.”—[Official Report, 17 November 1966; Vol. 736, c. 639.]
Despite the slightly opaque wording Wilson then used, that rapidly became known as the Wilson doctrine and it was extended five days later by Lord Longford to Members of the House of Lords. It was subsequently—and erroneously, it turns out—thought that it equally applied to Members of the European Parliament, to Members of the other three legislatures in Northern Ireland, Scotland and Wales, and to all other forms of digital communication.
Yesterday, the Investigatory Powers Tribunal gave its ruling on a case brought by the hon. Member for Brighton, Pavilion (Caroline Lucas), who is in her place, and others. The judgment states that
“The Wilson Doctrine has no legal effect”
and calls it
“a political statement in a political context, encompassing the ambiguity that is sometimes to be found in political statements”.
That runs contrary to assurances given to Members of both the Commons and the Lords by successive Governments, including the current one, and casts doubt on the protection supposedly afforded by the Wilson doctrine. To all intents and purposes, it means that the Wilson doctrine is dead.
From your own intervention to the tribunal, Mr Speaker, and from the points of order raised by several Members yesterday, it is clear that Members on both sides of the House believe that this ambiguity needs clearing up as a matter of urgency. I note that the Home Secretary stonewalled on the issue when asked about it by the hon. Member for Wellingborough (Mr Bone) on Monday, and this very morning the Leader of the House gave the most opaque comment I have heard yet on the matter.
Serious questions remain. First, is the Wilson doctrine still in operation in any meaningful sense whatsoever? Secondly, have parliamentarians’ communications been deliberately targeted? Thirdly, if so, has that been on the authority of a Minister, a Secretary of State or anyone else? This is an urgent matter and it needs consideration.
Mr Speaker
I am grateful to the shadow Leader of the House. The hon. Gentleman asks leave to propose a debate on a specific and important matter that should have urgent consideration under the terms of Standing Order No. 24, namely the Wilson doctrine. I have listened carefully to his application, and I am satisfied that the matter raised by him is proper to be discussed under Standing Order No. 24. Has the hon. Gentleman the leave of the House?
Application agreed to.
Mr Speaker
The hon. Gentleman has indeed obtained the leave of the House. The debate will be held on Monday 19 October as the first item of public business. The debate will last for up to three hours, and will arise on a motion that the House has considered the specified matter set out in the hon. Gentleman’s application.
Chris Bryant
On a point of order, Mr Speaker. I am very grateful to you for what you have just announced. Given the Leader of the House’s announcement earlier that we will have a statement from the Prime Minister on Monday—such statements sometimes run for an hour or even two hours—and that we will then have this three-hour debate, there will not be much time for the Psychoactive Substances Bill.
Chris Bryant
No. The Leader of the House says that that is our fault. It is for the Government to make provision for matters of interest to the whole House and to make proper provision for scrutiny of their own legislation.
Mr Speaker
I am grateful to the hon. Gentleman for his point of order. The short answer is of course that the timetabling of business is a matter for the usual channels, not for the Chair. It is important to explain that, not least for those beyond the House who are interested in and listening to our proceedings. What is a matter for the Chair—in general terms, but importantly—is the principle that the opportunity for scrutiny should be protected. It is extremely important, if there is a Second Reading of a Bill, that there is adequate time for it to be debated and, in the context of such a Second Reading debate, for its general principles to be the subject of scrutiny, so I hope that adequate time will be provided for that purpose. It is Thursday and the matters concerned will not be treated of until Monday, so there is certainly plenty of time for consideration of how the different priorities of the House can each and every one of them be met. I think we can leave that there for now. If there are no further points of order, the Clerk will now proceed to read the Orders of the Day.
Armed Forces Bill
(8 years, 6 months ago)
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The Secretary of State for Defence (Michael Fallon)
I beg to move, That the Bill be now read a Second time.
The introduction of an Armed Forces Bill is always a significant occasion for defence. It matters in particular for three reasons. The first reason is its constitutional significance. We are renewing the legislation necessary for the armed forces to exist as disciplined forces. That legislation is currently the Armed Forces Act 2006, which provides the system of command, discipline and justice for the armed forces. It covers matters such as the powers of commanding officers to punish disciplinary or criminal misconduct, the powers of courts martial and the powers of the service police. The 2006 Act confers powers and sets out procedures to enforce the duty of members of the armed forces to obey lawful commands.
Since the Bill of Rights in 1688, the legislation making the provision necessary for the Army to exist as a disciplined force—and, more recently, the legislation for the Royal Navy and the Royal Air Force—has required regular renewal by Act of Parliament. Without this Bill, the Armed Forces Act 2006 could not continue in force beyond the end of 2016. That reminds us that ultimate control over the system under which the armed forces are maintained resides not with the Executive, but with Parliament.
Secondly, this occasion is sufficiently rare in the lifetime of a Parliament to prompt us to reflect on the progress made since the last such Act, the Armed Forces Act 2011. The centrepiece of the last Act, the requirement to report on the armed forces covenant, remains more relevant than ever. The covenant has already made a huge difference to the lives of serving and ex-service personnel. In the past few years, we have seen not only the Government, but all 407 local authorities and more than 700 businesses, large and small, come together to make sure that our personnel get a fairer deal as a result of their service to our country.
Mrs Madeleine Moon (Bridgend) (Lab)
We have perhaps been somewhat neglectful of armed forces personnel when they cease to be serving and become veterans. Does the Secretary of State agree that we must place a greater priority on ensuring that veterans have ongoing help and support because of the difficulties that many of them may still face as a result of their service in Iraq and Afghanistan?
Michael Fallon
I certainly do agree with that. This work is ongoing and is not yet done. We will continue to try to make progress. As the hon. Lady knows, we have implemented a number of reviews, not least Lord Ashcroft’s review of the mental health services that are available to veterans.
I assure the House that our commitment to the covenant remains unshakeable. Today, we are launching a credit union for armed forces personnel. By paying a regular amount of their salary directly into the credit union, they will be able to avoid the struggle for credit approval and the siren call of the payday lenders.
Thirdly and finally, the Bill gives us the opportunity to ensure that the 2006 Act remains fit for purpose for the next five years. The first clause keeps the 2006 Act in force beyond the end of 2016; provides for the continuation of the 2006 Act for a year from the date on which this Bill receives Royal Assent; and provides for renewal thereafter by Order in Council, for up to a year at a time, until the end of 2021. That will give Parliament a regular opportunity to debate the systems of the armed forces for command, discipline and justice.
Clauses 2 to 6 modernise and strengthen the service justice system by making sensible and proportionate changes to the existing provisions. I will take each of those clauses, very briefly, in turn.
Clause 2, on post-accident testing for alcohol and drugs, deals with the situation whereby a commanding officer may require a member of the armed forces or a civilian who is subject to service discipline to co-operate in a preliminary test for alcohol or drugs only when he or she suspects that an offence has been committed. The clause extends those circumstances by providing for post-accident preliminary testing without the need for suspicion that the person being tested has committed an offence. The new powers to require co-operation with tests will apply only after accidents involving aircraft or ships or other serious accidents. They are derived from, although not identical to, those in the railway and transport safety legislation under which civilians are required to co-operate with tests for alcohol and drugs.
Clauses 3 to 5 simplify the process of investigation and charging of criminal and disciplinary offences under the 2006 Act. The commanding officer rightly deals with 90% of cases in the service justice system, and that will not change. The remaining 10% of cases are those that the commanding officer does not have the power to hear, which involve offences such as perverting the course of justice and sexual assault. Some cases that cannot be dealt with by the commanding officer have to be referred by the investigating service police to the commanding officer and then by the commanding officer to the director of service prosecutions for a decision. That is an unnecessarily complex process.
Clause 3 provides for the service police to refer straight to the director of service prosecutions in any case where there is sufficient evidence to charge for an offence that the commanding officer cannot deal with on his own. That brings the service justice system into line with the civilian system.
Bob Stewart (Beckenham) (Con)
Does that mean that the commanding officer is taken out of the loop entirely in cases concerning soldiers, sailors or airmen who are his or her responsibility?
Michael Fallon
No, because the commanding officer will be kept informed about the investigation and the stage it has got to. They are not being removed from the process; we are merely simplifying the procedure and shortening it so that the matter does not have to be referred automatically to the commanding officer and then back to the director of service prosecutions.
Clause 3 also deals with linked cases such as separate offences that occur during the same incident. Some cases may need to be sent to a commanding officer, even though they are connected to a case that has been sent to the director of service prosecutions, and that can result in separate decisions on whether to prosecute, and separate trials. Clause 3 allows the service police to refer a case to the director of service prosecutions if, after consultation, they consider it appropriate to do so because of a connection with another case that has also been referred to that director.
Clause 4 clarifies the procedure for the referral of those linked cases from the commanding officer to the director of service prosecutions, and clause 5 allows the director to bring charges. Currently, when the director of service prosecutions decides that a charge must be brought, they must direct the suspect’s commanding officer to bring that charge. Clause 5 allows the director to bring that charge, just as the Crown Prosecution Service brings charges in the civilian criminal justice system.
Clause 6 increases the range of sentencing options available to the court martial. Civilian courts are currently able to suspend sentences of imprisonment for up to 24 months, but service courts can suspend them for only 12 months. We would like courts martial to be given greater flexibility to vary the deterrent effect of service detention. In some cases it is right for suspended sentences to allow continued service alongside rehabilitation activities. The clause simply corrects the anomaly by giving courts martial the ability to suspend sentences of service detention for up to 24 months.
Clauses 7 and 8 give the director of service prosecutions power to give offenders immunity from prosecution, or an undertaking that the information they provide will not be used against them, in return for assistance that the offender may give to an investigator or prosecutor.
Dr Andrew Murrison (South West Wiltshire) (Con)
Will my right hon. Friend say what service offences he has in mind for immunity from prosecution? Will he reassure the House that that does not involve any form of plea bargaining, and say whether there are civilian equivalents of the kind of offences that he has in mind?
Michael Fallon
Only the most serious cases would involve that kind of immunity—perhaps the Minister will provide my hon. Friend with more examples of what such cases might be when he winds up the debate. These are cases where the evidence from a witness or defendant could be crucial, but where fears about self-incrimination stop someone coming forward and providing essential information.
In the civilian criminal justice system prosecutors such as the Director of Public Prosecutions have statutory powers to offer immunity and restrictions on the use of evidence, but the director of service prosecutions in the service justice system does not. That damages their ability to prosecute the most serious cases, because it may be necessary to rely on evidence from individuals who may not be willing to come forward and give evidence without conditional immunity, or an undertaking that that information will not be used against them. These clauses closely follow those in the Serious Organised Crime and Police Act 2005 that apply to the civilian criminal justice system.
I assure my hon. Friend that as in the civilian criminal justice system, the intention is for immunity and undertakings not to use information to be offered only in the most serious circumstances for those who are found, after proper investigation, to have fallen short of the high standards that we set.
Clause 13 brings the Armed Forces Act 2006 back into force in the Isle of Man and British overseas territories except for Gibraltar. Under United Kingdom law, the 2006 Act has always applied to members of the armed forces, wherever in the world they are operating, and that will remain the case. That means that a member of the armed forces commits an offence under UK law if they do something in another jurisdiction which, had they done it in England or Wales, would have been a criminal offence.
In addition, the 2006 Act originally formed part of the law of the Isle of Man and the British overseas territories. However, the Act expired in those jurisdictions in 2011. Clause 13 and the schedule to the Bill revive the Act in those jurisdictions so that, as it currently has effect in the UK, it will also be in force there. That ensures that things that members of the armed forces might do under the 2006 Act in those jurisdictions, such as the exercise of service police powers of arrest or search, would be lawful there not only as a matter of UK law but as a matter of the local law. It also ensures that the civilian authorities within those jurisdictions can do things under the 2006 Act which they might not otherwise have powers to do under the local law, such as the arrest of a person suspected of a service offence under a warrant issued by a judge advocate.
An exception is being made for Gibraltar. This is because we are currently consulting the Government of Gibraltar on how best to extend the provisions of the 2006 Act—and, therefore, of the Bill—to that territory.
Clauses 14 and 15 relate to Ministry of Defence firefighters. The Defence Fire Risk Management Organisation has more than 2,000 personnel operating over 70 fire stations. Yet those firefighters currently have no specific emergency powers to act to prevent or deal with fires to protect life or preserve property. That could lead to a situation where firefighters entering a property to put out the flames might have to defend themselves against charges of breaking and entering, or where restraining family members from returning to a burning building might leave them open to a charge of assault.
Fire and rescue services at some MOD sites are currently provided by a contractor. They, too, should be able to deal with an emergency in the same way as MOD firefighters. Clauses 14 and 15 address this issue by giving defence firefighters the same powers to act in emergencies as employees of a civilian fire and rescue authority.
In conclusion, the Bill is an important act in continuing the authority of the armed forces. It makes modest but relevant upgrades to the existing system for the armed forces of command, discipline and justice. The world-class reputation that our armed forces enjoy is underpinned by many factors, one of which is that system of command, discipline and justice. We need to make sure that that system continues to be fit for the modern age. I commend the Bill to the House.
Maria Eagle (Garston and Halewood) (Lab)
I welcome the opportunity to speak in today’s Second Reading debate on the Armed Forces Bill. This is my first opportunity to fulfil my new role in the House as shadow Secretary of State for Defence and I would like to begin by thanking the Secretary of State for the courtesy he has shown me so far in arranging appropriate briefing for me from his Department. I am grateful.
Let me start by offering my sincere condolences to the family and friends of Flight Lieutenant Alan Scott of 33 Squadron RAF and Flight Lieutenant Geraint Roberts of 230 Squadron RAF, who died in Afghanistan on Sunday. From the tributes I have read, both men were highly experienced, respected and valued members of the RAF family. Their deaths serve as a reminder of the commitment and dedication of our armed forces personnel, and of the sacrifices they make. The continuing work of our service personnel in Afghanistan makes a positive contribution to the safety and stability of that nation and beyond. I would also like to express my deepest sympathy and extend my condolences to the family of Megan Park, a young Army recruit who died last month while undertaking training in Pirbright. By undertaking her training, she showed her willingness to put herself in harm’s way for her country. My thoughts are with her family and friends.
The Bill renews the legal basis for retaining our armed forces in peacetime for another five years, while we are fulfilling Parliament’s hard-won right to give consent to the Government for so doing. As parliamentarians, we are fulfilling a key function when we consider whether to consent to this measure. That is one reason why the Bill is important. While our armed forces comprise some of our finest and most dedicated public servants, their actions are not protected or circumscribed by contracts of employment. They owe a duty of allegiance to Her Majesty the Queen, which requires them to obey lawful orders. It is the system of service discipline and justice, therefore, that enables commanding officers to enforce that obligation when necessary. We certainly have an interest in ensuring that the system of military discipline and justice is fit for purpose, up to date and works well. That is the second reason the Bill is so important.
The Secretary of State has set out the main provisions in the Bill. It seems to me that they are largely non-contentious, technical and simplifying provisions, all of which we will seek to probe in Committee to ensure they work as intended and to satisfy ourselves that they are fit for purpose. I welcome the provisions extending the circumstances in which commanding officers can require service personnel and civilians subject to service law to be tested for drugs and alcohol after accidents. We will want to be satisfied that the rationale for extending the provisions to cover the three new situations set out in the Bill is sound and to have a fuller explanation for the differences between the powers being taken and those upon which they are based in the Railways and Transport Safety Act 2003. We will also want to be clear that the new provisions are sufficiently comprehensive to encompass all likely circumstances.
We welcome the intention of the Bill in setting out to simplify how people are charged with offences within the service justice system. No one benefits from unnecessary delay or bureaucracy in the administration of justice, in whatever system such potential problems might arise. On the face of it, it seems entirely sensible to remove the delay that might be caused by the requirement to refer a case to the commanding officer when he is not in practice able to try it. If he must simply refer it to the director of service prosecutions, it seems sensible for that to happen without the reference from the commanding officer, but he must of course know what is going on with the men under his control. It also seems entirely sensible to refer to the DSP cases that are connected. We will want to probe further in Committee how much of the existing caseload is likely to be affected—I think the Secretary of State referred to some figures in his opening remarks—and where any disadvantages are perceived in the provisions as drafted. Similarly, provisions relating to enabling the DSP to charge directly instead of directing a commanding officer to do so seem sensible, but we will wish to have full assurances in Committee.
We will also want to be satisfied on the necessity of applying equivalent provisions to those in the Serious Organised Crime and Police Act 2005 relating to immunity from prosecution, undertakings not to use information as evidence and sentence reductions for offenders who co-operate with investigations and prosecutions. We will start from the assumption, however, that if they are useful in the civilian justice system, they might well be useful in the service justice system as well.
The Bill does not cover how UK disciplinary procedures apply to foreign troops trained by British service personnel on British soil. Following the serious and regrettable incidents last year involving recruits from the Libyan general purpose force undertaking training at Bassingbourn camp, the Government published a summary of a report that looked at the Libyan training programme—the full report has now also been published. In January, following the publication of the summary, the Secretary of State said he had asked officials to consider applying UK service discipline to training foreign troops in the UK. In a recent Adjournment debate, the Minister for the Armed Forces said:
“The report asked whether we could apply UK service discipline to troops training in the UK. This would involve bringing foreign troops into the British military chain of command and require significant amendments to the Armed Forces Act 2006. My Department has assessed the challenges and downsides of making those changes and decided that they would currently outweigh any benefits, particularly as we are keen to provide training in-country. I have therefore not instructed my Department to instigate such changes now, but I will keep the matter under review.”—[Official Report, 10 September 2015; Vol. 599, c. 651.]
It is important that lessons are learned from that very serious incident and that foreign troops who come to the UK to train with our military adhere to the same code of conduct as British troops. It is equally important that disciplinary procedures can be put into effect swiftly in cases where criminal offences are committed. The Minister appears to be saying it is too difficult to do this at present, but I hope she will consider fully whether that is an adequate response. As the House will recall, these matters included very serious crimes of sexual assault and rape. Sexual harassment, sexual assault and rape are among the most serious of criminal offences in both civilian and military spheres, and the service justice system must take such crimes as seriously as does the ordinary criminal law.
From meetings I understand have taken place at ministerial and official level, the Minister will know about the military justice campaign being run by Liberty. It has raised serious issues about the collection of statistics on sexual assault and rape and how the service justice system deals with allegations of these serious offences. We will want to probe in Committee what the current state of play is in respect of ensuring that such offences are treated as seriously within the service justice system as they are outside it.
Bob Stewart
On the argument about people visiting this country being subject to our military law, a big worry would be that we do not want other nations to apply their military law to our servicemen when they allegedly do something wrong in those countries. We want our military law to extend to our servicemen, wherever they are in the world.
Maria Eagle
Of course, the hon. Gentleman has a lot of knowledge of these matters, and I appreciate that such issues, as the Minister must have found, are very complex and difficult. Given the seriousness of the incidents and the fact that the Government undertook to look at the matter, it is important to have a full discussion about why they have come to the conclusion they have. I have not said that I disagree with the conclusion, but I think the House needs to probe fully why the decision, which she undertook to keep under review, was made. We will seek to probe that further during the Bill’s passage. I say no more than that.
Mrs Moon
May I say how much I welcome my hon. Friend’s appointment? I totally agree about the need to probe the issue of extending British law to troops based and training here. The people of Cambridgeshire need a full explanation of why that was not possible. Whether it proves possible is moot. The important thing is that they know it is being fully explored. Will she also say something about the importance of opening up the ability of members of the armed forces to come forward when they have experienced rape and sexual assault, as often they are advised by people in the chain of command that it might damage their career to do so?
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. There is plenty of time to speak. If the hon. Lady wishes to make a speech, I will put her on the list with pleasure.
Maria Eagle
I thank my hon. Friend, who is a member of the Defence Select Committee, for her welcome for my appointment, and I hear what she has to say about these matters. The reason Liberty is campaigning on some of these issues is that, if things go wrong, it can destroy people’s lives and cause many difficulties, not only for the individuals affected but for the services. In Committee, I want us to debate the matter further with Ministers, who I know have met and considered these matters with campaigners, and to hear a bit more detail about policy development and where they are in respect of some of these things.
We have already heard from the Secretary of State the rationale for extending the provisions in the Armed Forces Act 2006 to the Isle of Man and British overseas territories, except Gibraltar, but we will want to make sure, by way of the normal scrutiny one would expect of a Bill, that the provisions are correctly drafted, fit for purpose and will do what he said he wants them to do.
We are concerned about the rationale for the provisions in clauses 14 and 15 relating to the powers of Ministry of Defence firefighters in an emergency. There is no discernible problem, or any reason why those provisions need to be in the Bill. The explanatory notes suggest, as the Secretary of State did, that MOD firefighters currently have no power in an emergency to act to protect life and property, but I wonder whether there have been instances of the kind of difficulty to which he referred. Have there been instances of such firefighters being prosecuted, or being sued for assault or for breaking and entering? If there have been any such instances, I can see why he might want to introduce these provisions. If there have been no such instances and this is simply a tidying-up exercise, how come he perceives a problem now?
Michael Fallon
Let me try to answer that, but first may I welcome the hon. Lady and her team to the Dispatch Box for the first time? This measure is, of course, a precautionary one to reinforce the powers of those firefighters. There may well be instances where they might have to enter service accommodation or a civilian house on or near an MOD airfield. In other circumstances, perhaps in a remote area, MOD firefighters may be the first to reach a civilian fire in a civilian area, having got there in advance of the local authority fire service, but they do not have exactly the same powers. The purpose of these clauses is to deal with these things.
Maria Eagle
I am grateful to the Secretary of State for that further explanation. In preparing for my remarks, I gave the chief fire officer of Merseyside’s fire and rescue authority a ring to ask whether the Chief Fire Officers Association, of which he is a member, has been consulted about these provisions. I thought it might have asked for this kind of measure. My contact with him was the first he had heard of these provisions, although he was of the opinion that he would have expected the CFOA or the local authority fire and rescue authorities to have been consulted ahead of their introduction. They are category 1 responders and would have expected to have been consulted on these provisions. There are well-known, regular opportunities for the MOD to consult and liaise with the civilian fire authorities and chief officers, but that has not been done in this instance, which made me wonder precisely what was going on. The provisions seem to imply the deployment of MOD firefighters beyond the confines of their current role on MOD property. The definition of “firefighter” includes, as I believe the Secretary of State said, contractors and subcontractors employed by private companies, and we are at a time when the work the Defence Fire Risk Management Organisation does is being outsourced or tendered. We will want to probe this matter further in Committee.
The Secretary of State has sought to reassure me, and I am open to being reassured. I am pleased to confirm that, with those few remarks and slight concerns notwithstanding, we will be supporting the Bill and seeking in Committee to probe its provisions, improving them where we can. Of course, if they cannot be improved, we will support them. [Interruption.]
Mr Deputy Speaker (Mr Lindsay Hoyle)
Is anybody interested in speaking? I call Jack Lopresti.
Jack Lopresti (Filton and Bradley Stoke) (Con)
I was extremely interested in speaking, but I was being very courteous in waiting to be called, Mr Deputy Speaker.
Like the hon. Member for Garston and Halewood (Maria Eagle), I wish to send my condolences to the families of our service people who have recently died on operations and during training, and I echo the comments she made. That is a further example, as if we needed one, of the sacrifice and sense of duty of our service people, and the debt of gratitude we owe all of them.
I particularly welcome the Bill’s overall objectives and its content. It is in a noble tradition, stemming, as the Secretary of State said, from the Bill of Rights, under which no standing Army—obviously, that is now extended to our armed forces—may be maintained during peacetime without the consent of Parliament. That provision under the Bill of Rights is one of this country’s enviable documents that form our uncodified constitution, which balances the power of the monarch, the Government and the Houses of Parliament.
This Bill, enabling our country to maintain standing armed forces, could not come at a more relevant time, given the challenges we face around the world. We live in an increasingly dangerous age, with Putin’s army on the march in Crimea and Syria, and the problems we face in the middle east with ISIS. I understand that for some, although not I would think those on the Opposition Front Bench today, there is confusion about the importance of the defence of the realm; the Leader of the Opposition has said that he questions why
“a country of 65 million people on the north-west coast of Europe”
needs “to have global reach”. I am sure that none of the Opposition Front Benchers would agree with his comments on abolishing the armed forces and leaving NATO.
We of course need armed forces, and I am extremely proud of them, as I am sure everybody else here is. Our armed forces are the best in the world. I have some modest experience in this area, having had one of the best years of my life—so far—when I served with the fantastic men and women of 3 Commando Brigade in Afghanistan on Operation Herrick. I am very proud that 4,000 brave and extremely capable men and women are deployed around the clock on 21 different joint operations in 19 countries, which is double the figure of five years ago.
Britain has the biggest defence budget in the whole of the European Union and the second largest in NATO. I was delighted when the Chancellor rightly announced in July that the UK had committed to meet the NATO pledge to spend at least 2% of GDP on defence every year of this decade, with the MOD’s budget rising by 0.5% per year. Of course, an additional £1.5 billion a year by 2020-21 will be made available to the armed forces, and security and intelligence agencies in a new joint security fund. I do not think anybody here needs reminding of the significance of our armed forces; the defence of the realm is the first duty and responsibility of any Government. I have said it before, but one of my favourite quotes is from the late Lord Healey who served with the Royal Engineers during world war two and was military landing officer for the British assault brigade at Anzio. He said:
“Once we cut defence expenditure to the extent where our security is imperilled, we have no houses, we have no hospitals, we have no schools. We have a heap of cinders.”—[Official Report, 5 March 1969; Vol. 779, c. 551.]
But the UK is investing in British security, British prosperity and our place in the world, which transforms our ability to project power globally, whether independently or with allies.
I also had the privilege of serving on the Armed Forces Bill Committee during the last Parliament, when the Government took the historic step of enshrining the armed forces covenant in law for the first time. We now have an increasing number of veterans who have seen active service in Iraq, Afghanistan and elsewhere, and we have a duty and responsibility as a nation to make sure they are looked after and are not in any way disadvantaged by their previous military service. I worked with my local authorities to ensure that they signed the community covenant, too.
This Bill has some interesting aspects that we ought to explore further in some detail. We have talked about provisions whereby a commanding officer may require a member of the armed forces or a civilian subject to service discipline to be tested for alcohol and drugs, and about how we are looking to change things in that area. I share the concerns of my hon. and gallant Friend the Member for Beckenham (Bob Stewart), who said that he was worried that under the new provisions a commanding officer could be a little out of the loop when it comes to the welfare of, and duty of care towards, his or her men. I think we will look at that in more detail. As far as I am aware, the last two major deployments were largely “dry” operations, but when our military personnel are on duty they must not be under the influence of alcohol or drugs.
Cutting red tape and potentially simplifying the way justice is carried out is sensible. The increase of the period that a sentence of service detention may be suspended from 12 to 24 months could enable a more flexible form of justice. As the chairman of the all-party group on Gibraltar, I will be interested to see how Gibraltar is incorporated in the extension of the Armed Forces Act 2006 to the whole of the UK, the Isle of Man and British overseas territories. I know that conversations are taking place and work is going on, but I will be interested to see how that will work out.
The House will obviously have to look in some detail at clauses 14 and 15, which propose extending the statutory powers to MOD firefighters in an emergency, providing the same powers to act as those of civilian fire and rescue authorities. I look forward to working with colleagues from all parts of the House on the progress of this very important Bill.
Brendan O'Hara (Argyll and Bute) (SNP)
I, too, welcome the hon. Member for Garston and Halewood (Maria Eagle) to her new role; I look forward to working constructively with her and her colleagues in the coming weeks and months. On behalf of the Scottish National party, may I also express our deep sadness at the loss of Flight Lieutenant Alan Scott and Flight Lieutenant Geraint Roberts? We, too, extend our most sincere condolences to their families and friends on the tragic loss of such highly regarded servicemen.
It goes without saying that we support the renewal of the Armed Forces Acts that enable our dedicated and professional service personnel to defend and protect the people and the interests of all four constituent parts of this United Kingdom. We will fully engage with the Bill as it progresses through Committee.
Let me put on the record at the first opportunity to do so since coming to this place that we wish to highlight some serious concerns about the current state of the armed forces, particularly pertaining to Scotland. It is an inescapable fact that since the last Armed Forces Bill came before this place, a record number of servicemen and women have been betrayed by a Government who have overseen historic levels of cuts to the number of service personnel and the military footprint in Scotland. Year on year, we have had to endure cuts to the number of people serving in our armed forces. The Scottish Government’s employment figures show a 9.5% drop in the number of people employed in the armed forces in Scotland. That is a staggering 2,800 jobs lost in just five years. It is a matter not just of military personnel but of Scotland’s military footprint.
Since the strategic defence and security review of 2010, we have lost two of our three air bases—Leuchars and Kinloss—and we have had to witness an act of gross military vandalism when the Nimrods, the nation’s strategically vital maritime patrol aircraft, were chopped into pieces and sent for scrap. Given the United Kingdom’s geographic position in the north Atlantic, not having maritime patrol aircraft is quite remarkable, but for the United Kingdom to have had MPAs and then to have had them chopped into pieces and scrapped simply beggars belief.
Mr James Gray (North Wiltshire) (Con)
Many of us in the House would agree with what the hon. Gentleman says, and we opposed many of these sad cuts, which were necessary for the nation to break even. Will he enlighten the House? If the outcome of last year’s referendum had been different and we now had an independent Scotland, would he guarantee that the pre-cuts strength that he decries that we have lost would be replaced by the Scottish National party and the Scottish Government? Also, how many jobs would be lost if Trident were to be removed from Scotland?
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. I can understand the temptation, but I do not want to open this pretty technical debate into a general point-scoring debate on policy. As I say, I can understand the temptation, but I am sure the hon. Member for Argyll and Bute (Brendan O'Hara) will want to stick to what we are debating.
Brendan O'Hara
Thank you, Mr Deputy Speaker. To respond very briefly, I refer the hon. Member for North Wiltshire (Mr Gray) to the White Paper published before the referendum. Everything would be contained therein. The Scottish National party is quite clear about its paramount commitment to conventional defences. We would thus obviously invest in such defences.
I shall take your advice, Mr Deputy Speaker, and perhaps not engage further, other than to say that we shall support the Bill as it makes its way through Committee. Most notably, at the 2015 general election, the SNP was the only party to make a commitment to providing a statutory footing for a British Armed Forces Federation. We would like to introduce such provisions into the Bill in Committee. There is, of course, already an established British Armed Forces Federation, which provides a professional, independent and apolitical voice for service personnel. The BAFF is, in its own words,
“a specifically British solution for the British Armed Forces”,
which campaigns on range of issues such as armed forces housing, compensation and improved medical care for veterans.
Veterans’ mental health is particularly important. I recommend anyone attending last night’s Adjournment debate—and those who did not attend it—to get hold of the Hansard and read the fantastic contribution from my hon. Friend the Member for East Kilbride, Strathaven and Lesmahagow (Dr Cameron), ably supported by the hon. Member for Plymouth, Moor View (Johnny Mercer). This was a learned and informed debate—a shining example, I believe, of this House at its best.
If the BAFF were given statutory status, it would be a far more robust organisation in providing legal advice, aid for the writing of wills, anti-bullying advice, grievance reporting and, of course, aid to those with mental health problems. The idea of having an armed forces federation is not new and it is not radical. Indeed, there are several such federations operating extremely well within the armed forces of many of our NATO allies. Norway, Denmark, Belgium, Germany and Hungary all have armed forces federations, while there are also recognised and functioning armed forces federations in Australia and, closer to home, in Ireland. I firmly believe that a mature and responsible military such as that of the United Kingdom has nothing to fear from an armed forces federation.
As I said elsewhere, it should be seen as complementary rather than in opposition to the chain of command. A federation would not impinge in any way on the chain of command, but would rather give support to service personnel and their families—and, of course, to our veterans, to whom we all have a duty of care. If a federation works well for the police force, surely it is wholly appropriate that we extend the same right to our military personnel, who put their lives on the line every time they go on duty.
In conclusion, we support the Bill and will continue to support it, but we will go through it, as the hon. Member for Garston and Halewood said, line by line to make sure that the Bill will be the best that it can be. Our service personnel deserve no less.
Mrs Sheryll Murray (South East Cornwall) (Con)
I welcome the Bill, which allows our armed forces to be recruited and maintained as disciplined bodies. I want to pay tribute to our brave armed forces personnel, particularly in the Royal Navy. The House will know of my special interest in this service because my daughter is a serving Royal Navy officer. My interest goes further than that, however. HMS Raleigh, the premier initial sea training establishment, is based in my constituency. It provides considerable employment, as does the Devonport naval base and dockyard. There is also the Thanckes oil fuel depot at Wilcove. The Royal Navy is thus at the very heart of my constituency. Young recruits experience their first six weeks of what it is like to serve in our armed forces there. That is why the Bill is important—because we must maintain recruitment.
I welcome the clauses to modernise and update the Armed Forces Act 2006 to ensure that our armed forces are appropriate for modern times. It is important to pass the Bill to ensure that we recruit and maintain disciplined armed forces who will be able to operate professionally in our services. I particularly want to ensure that we man our Vanguard submarines, and I am delighted that my right hon. Friend the Secretary of State has confirmed that four new successor submarines will be introduced. This Bill will ensure that the manpower is available for them to remain fully operational.
Devonport dockyard in Plymouth is the sole nuclear repair and refuelling facility for the Royal Navy. Its excellent work has been long championed by my hon. Friend the Member for Plymouth, Sutton and Devonport (Oliver Colvile). I understand that my right hon. Friend may not be able to do so today, but I would be grateful if he could confirm as soon as possible that the continuing refuelling programme for the ballistic submarines will continue at Devonport as the new submarines are integrated into the fleet.
I feel that I should also mention my surprise that the Leader of the Opposition seems determined to compromise the security of our armed forces and this nation when he talks of abandoning our continuous at-sea deterrent.
I welcome the Government’s commitment to the new aircraft carriers. My right hon. Friend the Secretary of State has already told me that they will be manned by a crew whose numbers will be similar to those on HMS Invincible, despite being three times its size. He has also told me that the Royal Navy is planning to ensure that it has the suitably trained and qualified people it needs, and that that will include training on HMS Raleigh in Devonport. It would be good to hear that he is confident that we have enough suitably qualified and experienced personnel who are ready when they are needed to develop the operational capability of both ships.
Let me finally say something about clause 14. I am pleased that the Act is being amended to recognise the brave firefighters in our armed forces, and to give them the same authority as our civilian firemen and women. I thank them for their brave work in keeping our military safe.
Jim Shannon (Strangford) (DUP)
It is a pleasure to speak in this debate. Let me begin by expressing, on behalf of my party, sincere sympathies to the families of Flight Lieutenant Alan Scott and Flight Lieutenant Geraint Roberts, who gave their lives in Afghanistan.
I thank, with sincere appreciation, all who have contributed to the Bill’s progress so far, and who have introduced changes that have been in reserve until now. The issue that we are discussing is of the utmost importance to every Member. Those who are present have a specific interest in it, but many others who would like to be present are unable to attend. For the record, let me convey an apology from the Chair of the Defence Committee, and from other Committee members who cannot be here because they are dealing with other business, but who would have wished to participate if that had been possible.
A strong, effective and renowned armed forces has always been at the heart of our great nation—that united nation of the United Kingdom of Great Britain and Northern Ireland, with all four of its regions together—and has always been a proud and important pillar of our national identity. Like others who are present, I am strongly committed to the armed forces covenant, which I want to see delivered in its entirety throughout all four regions in the United Kingdom. I also believe that it is important to look after veterans with mental and physical disabilities. Last night, we had the opportunity to listen to an excellent speech by the hon. Member for East Kilbride, Strathaven and Lesmahagow (Dr Cameron), who presented the case for those veterans. As we heard just now from the hon. Member for Argyll and Bute (Brendan O’Hara), the report of that debate is well worth reading, including the positive response from the Minister for Community and Social Care.
I am sure Members agree that when our armed forces are having a positive impact, whether delivering aid to the needy or toppling a tyrant, that instils in us a great sense of pride in being British—and no one is prouder than I am of being British. That said, however, when something is broken it needs to be fixed, and when something could be better, it needs reform. Unfortunately, not all our personnel are receiving the protection that they deserve in terms of their human rights. It is time for a review and time for change, and that is what the Bill proposes. The key focus of the Bill must be on ensuring that we protect and uphold the human rights of those who serve in our armed forces.
I commend the Defence Secretary for creating a service complaints ombudsman. That positive legislative change was necessary, and it is vitally important to ensuring that our armed forces receive the fair treatment that they have earned and deserve. I was delighted with the amendment to the Armed Forces (Services Complaints and Financial Assistance) Act 2015, which granted the new ombudsman power to investigate the nature of service complaints rather than merely processing claims of maladministration. That was clearly a positive step.
However, while those developments are most welcome, more could and needs to be done. Members have mentioned alcohol and drugs: the Secretary of State did so in setting the scene, and no doubt others will do so as well. We need armed forces that are accountable and responsible, we need a system of regulating and legislating, and we need testing for alcohol and drugs.
There is overwhelming evidence that sexual assault and rape are a pressing issue for many of our service personnel, especially our servicewomen. In its 2015 sexual harassment report, the Army recorded that 39% of servicewomen questioned had received unwelcome comments about their appearance, body or sexual activities, compared with just 22% of servicemen. Furthermore, 33% of servicewomen had been subject to unwelcome attempts to talk about sexual matters, compared with only 19% of servicemen; 12% of servicewomen had received unwanted attempts to talk about sexual matters, compared with just 6% of servicemen; 10% of servicewomen had received unwanted attempts to establish a sexual relationship, despite discouragement, compared with only 2% of servicemen; 4% of servicewomen had been told that they would be treated better in return for a sexual relationship; and 2% reported that they had been sexually assaulted.
Those statistics reveal something that is totally horrendous and totally unacceptable, and the need for significant change. The Bill gives us a chance to make that change, which is good news. Some of the figures may seem small, but that does not make them any less unacceptable. Would any other line of work tolerate such figures? The Departments concerned would certainly be asked to make legislative changes. Indeed, would such figures feature in any other line of work? The figures that I have given show that sexual assault and rape are a problem that needs to be tackled within our armed forces—not least for women, who fare far worse than men.
Steven Paterson (Stirling) (SNP)
Does the hon. Gentleman think that the existence of a representative body—a federation—would help or hinder a solution to the problem that he is rightly identifying?
Jim Shannon
We shall obviously have some idea of the Government’s thoughts on that when the Minister responds to the debate, but I think that the establishment of such a body would be very helpful, although its terms of reference would have to be discussed.
The nature of the Army prevents many women from speaking out, because they do not want to be perceived as weak in such an environment. The problem is that there is such a strong bond of camaraderie that the culture makes it important for servicemen and servicewomen to get along without creating a fuss. As we know, there have been stories in the press about service personnel who have been abused and subsequently traumatised, and who, unfortunately, may have succumbed to loss of life as a result. There needs to be a change in the culture of our armed forces in relation to this serious subject, but we, as legislators, can do our part by means of the Bill.
Data and evidence of such offences are scarce, because we lack a comprehensive and reliable collection of data. That, too, must change: we need to get a serious grip on the issue, and we need records so that we can monitor our progress. As well as monitoring, however, we should set a target for administrative change, and the Bill may make that possible. To fix any problem, it is necessary first to understand the extent of it, and the lack of data does not reassure those concerned that the issue is being taken seriously enough. This is just one of a number of areas that urgently need reform.
It is incredibly worrying that the Sexual Offences Act 2003 does not ensure that a commanding officer is required to notify the police of an allegation of a sexual assault. In fact, such an inherently serious offence ought to be subject to an automatic referral, and I should like that to be considered during debates on the Bill. Sexual assault is a gross violation of an individual’s physical integrity, and the repercussions for the victim can be endless. As I said earlier, we are well aware of high-profile cases in which people have taken their lives. The figures and statistics that have been cited today should shock each and every Member, and I hope they have made clear the need for urgent action.
I commend the changes relating to Ministry of Defence firefighters. It seems ludicrous that when firefighters need to break into a place, they should not be able to do so, and it also seems ludicrous that they cannot regulate traffic. Those are small changes, and it is only right that they should be made.
I hope and trust—indeed, I know—that Members will take seriously all the comments that have been made, and will continue to pay the utmost attention and respect to these incredibly important issues. I commend the Armed Forces Bill.
Kit Malthouse (North West Hampshire) (Con)
I rise to support the re-establishment of the British Army, a matter about which I assume there will not be that much dissent—although give it a couple of weeks and who knows where the Opposition Front Bench will be. Pleasingly, the British Army headquarters are based in my constituency, although I do not hear a huge amount from them. I assume they have more powerful allies in this House than me, but they will not have a more committed one. I am very pleased to see this Bill come forward, because this is an extremely important time for the British Army—a time of great flux in terms of challenge and budget, with 2% of GDP now having been guaranteed by the Government. That will be a challenge for the Army, going a little in reverse from where it has been, and matching that through the SDSR to capability is going to be something of an iterative process. In that regard, I wanted to raise a few issues.
First, the Army is devoting more time and energy to research and technology. The nature of warfare is changing significantly as automation becomes more and more the norm. At the moment we are largely seeing that in airborne form, but the day will come quite soon when our cavalry or tank regiments become more automated; unmanned tanks are on the horizon, and significant research is taking place in the United States and elsewhere into battlefield robotics generally. I urge Ministers to consider the implications for the future.
We have too often played catch-up in our procurement in the armed services. I am old enough to remember the Heath Robinson saga of the Nimrod which never quite kept up with requirements, and TRIGAT, an anti-tank missile which took so long to come to fruition that by the time it was ready to fire, tanks had been developed whose armour could resist its penetration. More investment in technology and research is therefore critical.
My second point is about resilience. Pleasingly, the Government have taken £145 million of LIBOR fines and devoted it to welfare among families of service people. I hope Ministers will consider making sure that a fair proportion of that is spent on mental health welfare, about which we have had numerous debates in this House, not least last night when we had an Adjournment debate on this very subject.
I do not know whether legislation is needed to extend the welfare capability of the Army to those of other nationalities who have served alongside. The Minister will know that I am particularly concerned about the plight of those who acted as interpreters for the British Army in Afghanistan, about which there has been some press coverage in recent weeks, and whether they and their families are in receipt of some of the welfare funding that is available, and whether the Army has the power to transfer money and resources to their assistance. I would like that to be considered.
There is one issue in respect of the Bill that Ministers might consider on Report. There is a pleasing and sensible measure to extend testing for alcohol and drugs when an accident has occurred. That made me wonder whether Ministers might consider incorporating in the armed service disciplinary code the penalty of compulsory sobriety. The Ministry of Justice has recently extended this innovative solution to alcohol-based crime to the whole country, so that police and crime commissioners can now use it on a regular basis, following a successful trial in Croydon, in which I confess I had a hand when I was deputy mayor for policing in London. Essentially, rather than being sent to prison or be subject to other draconian measures, those convicted of an alcohol-based crime are tagged for three or six months with a tag that tests them for alcohol every 30 seconds. If they contravene there are other penalties available, but pleasingly about 98% of people comply. The great advantage of this disposal is that nobody goes to prison so people maintain their job and contact with their family. Compliance is much greater and it removes the alcohol which is the source of the offending.
It might be sensible for Ministers to investigate whether this needs incorporating in the Army code, because I have a feeling that as a disposal it will grow in popularity across the country, as it is doing in the United States. We discovered this in South Dakota, where it has taken drink-driving from three times the national average down to below the national average, and the disposal generally is now creeping its way into being used in all sorts of offences, not least domestic violence, where alcohol plays an enormous part.
I welcome the Bill and support it. We need no greater reminder of its importance than the tributes paid to the airmen who lost their lives recently. They were the best of us and their families have our deepest condolences.
Douglas Chapman (Dunfermline and West Fife) (SNP)
If ever there was a Bill that underlined the need for a written constitution, this would probably be it. When a constituent asks me what I do when I am down here, I do not think they would be happy to hear that we spend valuable legislative time renewing a Bill that was first put before the House in 1688. That shows that this country’s relationship with its armed forces personnel is outdated. The Glorious Revolution brought us this tradition.
Mr James Gray
I am astonished by that comment. The hon. Gentleman says he resents spending his time renewing this Act, but he completely misunderstands the point. The whole point is that it is this Parliament’s right and duty once every Parliament to renew our relationship with the armed forces. If, by a written constitution or some other means, that did not happen, our rights and duties in this place would be severely reduced.
Douglas Chapman
My point is that if there were a written constitution we probably would not have to go through this process each time and our business might be better understood by the general public, who are sometimes at a loss to understand some of the intricacies of the ways of the House.
The tradition we have in Scotland of contributing more economically and in manpower to the armed forces than we receive in return is a different tradition. I thought that the rules now were that we pool our resources and fairly share the spoils of the UK. However, in terms of defence spending, Scotland continues to pool our resources, tax base and manpower, but much more of the investment is sucked elsewhere. That must change.
We look forward to the Bill being debated and scrutinised in Committee. It must be considered within the context of resources, where the service personnel are deployed and how that impacts on the families of service personnel and veterans. There is massive underinvestment in conventional defence forces in Scotland, which is both unfair and dangerous. The Ministry of Defence used to keep records of investments made in Scotland but mysteriously stopped, apparently when it became clear that questions from my right hon. Friend the Member for Moray (Angus Robertson) were decidedly inconvenient to the idea of Scotland being “better together”.
Other Members have mentioned their constituencies and how investment is affecting work practices there. However, in Scotland we must also recognise that the 2010 defence review brought an end to many of our historical regiments, and that had an impact on both recruitment and morale. We have lost two of our three air bases with the third, Lossiemouth, yet to receive adequate assurances that it will outlast the Tornado. We are a maritime nation with a coastline about as long as that of India, yet we are without a maritime patrol capability. There is not one serious ocean-going surface-based ship in a country which built some of the best ships in the world at places such as Scotstoun, Govan or Rosyth in my constituency.
I do not want to spend much more time discussing the Bill as we will be scrutinising it in Committee. We welcome the progress that has been made so far, and we will continue to consider how it and other Bills will affect defence investment in Scotland.
Mrs Flick Drummond (Portsmouth South) (Con)
On a rather sad note, may I pass on my condolences to the families of Flight Lieutenant Scott and Flight Lieutenant Roberts? At the same time, I should like to take this opportunity to congratulate all the young men and women who passed out of the Royal Military Academy at Sandhurst this summer alongside my son. I know that they will serve their country with pride, and possibly with their lives, just as Flight Lieutenant Scott and Flight Lieutenant Roberts did. Along with my hon. Friend the Member for South East Cornwall (Mrs Murray), I know how that must feel. I am sure that the whole House, including the Leader of the Opposition, will ensure that they receive all the necessary support—be it political, moral or financial—to ensure that they have the finest equipment and leadership, including the justice system which we are discussing today, to enable them to fight the battles that we will put them through.
Parliament takes the opportunity, by passing an Armed Forces Bill during each Parliament, to reaffirm its support for the armed forces and for the brave, selfless people who serve in them. It is an honour to represent Portsmouth, alongside the Minister for the Armed Forces, my hon. Friend the Member for Portsmouth North (Penny Mordaunt). It is the home of the Royal Navy and of its people, whose families are on the front line in every struggle this country faces. It is important that our forces should be properly equipped and that their laws should be clear and comprehensive. The UK has the chance, through the strategic defence and security review process and the renewal of this legislation, to review recent history and examine any mistakes, as well as to plan for the future.
People at home and our allies abroad will welcome our commitment to maintain our defence spending at 2% of GDP. In the long term, we might need to restore the defence budget to a higher level than that. Our capabilities have to match our commitments. I welcome the equipment plan for the coming decades, but we should also give more thought to the personnel operating that equipment. In my first few months as a Member of Parliament, I have already seen a number of serving and ex-service personnel facing a variety of problems, from family law to healthcare and housing, resulting from their time spent in the forces. Some of them wonder what the armed forces covenant actually stands for, when they find themselves banging their heads against the doors of officialdom.
In many cases, however, personnel have had recourse to the excellent charitable organisations, including Combat Stress, the Royal Navy and Royal Marines charities, SSAFA, the Royal British Legion and the Royal Navy Benevolent Trust. Some of them provide a central resource for those seeking help in Portsmouth at Castaway House; some have also received LIBOR money. I hope that the military covenant can be strengthened so that nobody leaves that place feeling as though they have been cast away.
After the election, it was an early priority of mine to meet those organisations to understand the challenges that they and the people they represent face. We know, not least from the debate last night, that Combat Stress has seen a 28% increase in referrals in the last financial year. I pay tribute to the work of the Department of Health, which makes a strong contribution to supporting veterans, but it is too often felt that we take a reactive approach to the challenges of service life and health outcomes, rather than a proactive one. At present, Combat Stress’s contract with the NHS in England and Scotland is due to be terminated in 2017. I hope that the Minister will assure the House that the great work that it does will be carried on in the future.
Bob Stewart
To emphasise my hon. Friend’s point, post-traumatic stress disorder can occur 14, 15 or 16 years after a man or woman has finished their service. That is why Combat Stress is so important.
Mrs Drummond
And that is why the military covenant should continue throughout the whole life of a veteran.
I welcome the further reform to the armed forces justice system that the Bill introduces. The services operate very differently from civilian life, and a specific system is necessary to cover them, but that does not mean that the rights of those in the forces should be any weaker. It is important that service personnel should enjoy the same protections of due process and the rule of law as those in civilian life. The reform of the operational period in clause 6 brings service practice closer to the operation in the civilian courts. I also welcome clauses 7 to 12, which extend the scope for granting immunity from prosecution in service cases. Sometimes that is necessary to uncover a greater evil and bring it to an end.
However, I believe that the legislation should do more to clarify and support whistleblowing in the services. It is a tragedy for the families of those involved that they are still looking for answers to what happened at Deepcut barracks almost 20 years ago. I welcome the new code of conduct for the Army on bullying. The Armed Forces (Service Complaints and Financial Assistance) Act 2015, which was passed at the end of the last Parliament, introduced an ombudsman process to allow personnel to raise issues and to allow the ombudsman to investigate the substance of those cases. I look forward to that process starting shortly.
The Government recognise the importance of bringing the same protections to service personnel that civilians enjoy. Since the passage of the Armed Forces Act 2006, the armed forces justice system has been brought a long way forward from the unsatisfactory state it had been in. But a justice system is there to protect people as well as to prosecute them, and there is still room for improvement, as the hon. Member for Strangford (Jim Shannon) mentioned, in key areas such as bullying and the prevention of sexual harassment. I am sure that we shall continue to improve the armed forces justice system and keep it under review, either through this Bill or through the armed forces legislation that I have mentioned, which I hope will be incorporated into it. We will be reviewing that legislation in every Parliament as well.
Kirsten Oswald (East Renfrewshire) (SNP)
I am pleased to be able to follow the thoughtful speech by the hon. Member for Portsmouth South (Mrs Drummond). I should like to reflect on the events of a century ago and put on record some of those who made the ultimate sacrifice. War memorials in Scotland record many lives lost at the battle of Loos, which raged briefly in September 1915. The newly built war memorial funded by the people of Neilston, in my constituency, remembers the sacrifice of soldiers from the village and the surrounding areas who were killed in world war one, a number of whom were lost at Loos. I grew up in Carnoustie, a town that prides itself on two men who were awarded the Victoria Cross. Lance Corporal Jarvis of the Royal Engineers was the first recipient of the Victoria Cross in the first world war. He risked his life for over an hour under enemy fire to destroy a bridge to protect retreating colleagues. Petty Officer Samson of the Royal Navy Reserve gained his Victoria Cross for tending the wounded on the beach at Gallipoli.
As my hon. Friend the Member for Argyll and Bute (Brendan O’Hara) has said, we support the Bill. I also echo the words of the shadow Minister, the hon. Member for Garston and Halewood (Maria Eagle), in saying that we look forward to debating the detail of the Bill in Committee, to ensure that it will be the best and most effective that it can be.
It is worth recalling that the backdrop to recent legislation in this area has sometimes been the fraught relationship between the Government and the armed forces in regard to issues such as Afghanistan and Iraq. In fact, senior officers were forced to go public in an effort, as they saw it, to protect those under their command. The current members of our armed forces are entitled to ask that we learn lessons, when they are there to be learned, and that we do not repeat any mistakes that might have been made.
We also need to look at how best to support those who have been involved in wars. As my hon. Friend the Member for Argyll and Bute said, the Scottish National party’s manifesto made a commitment to the creation of a British armed forces federation. I was encouraged by the positive words from the hon. Member for Strangford (Jim Shannon) on that subject. This would represent real progress in the way we deal with our responsibility to undertake our duty of care to our service personnel. We absolutely must use the opportunity that we will have in Committee to continue to modernise the governance of our armed forces and to consider properly how we treat those who enter the services. In so doing, it is particularly important that we understand and act on our responsibilities to those who suffer as a consequence of their service, and to their families—for instance in relation to their housing needs. The Scottish Government’s funding for supported housing in Cranhill is very welcome in that regard.
It was positive to hear the Prime Minister’s comments yesterday at Prime Minister’s questions on the care that the forces medical services provide so well. It was also useful to participate in yesterday’s Adjournment debate on veterans mental health provision, secured by my hon. Friend the Member for East Kilbride, Strathaven and Lesmahagow (Dr Cameron). There is clearly a will in this House to properly and effectively consider the mental health of our service personnel during and, importantly, after their service. We need to work together to ensure that the provisions of the Bill reflect that good will towards our armed forces.
We must commit to doing more work like the intensive post-traumatic stress disorder treatment programmes that NHS Scotland and Combat Stress are undertaking. Like the hon. Member for Portsmouth South, I have been fortunate to meet a number of organisations dealing with veterans over the last few months. It is striking how much of a support network is provided by charities such as the Coming Home Centre, Horseback UK and Scottish War Blinded. The work that they and others do to support our armed forces and our veterans is immense and we owe them a debt of gratitude.
I am pleased that Scotland is leading the way with the appointment of a Scottish veterans commissioner. That appointment is most encouraging, and it reinforces the Scottish Government’s commitment to providing support to the 400,000-plus ex-servicemen and women living in Scotland and to the capacity-building funding they are providing to Veterans Scotland to allow the organisation to work on developing and improving support for our veterans over the next two years.
Let me briefly mention my own constituency. I was heartened by the focus on the veterans in East Renfrewshire as well as in neighbouring Inverclyde. Our local authorities are working together in Renfrewshire on a veterans support service, which provides local support to address individual circumstances.
Veterans and our current serving personnel will rightly expect this House to use the opportunity of this Armed Forces Bill to examine all the issues, including the creation of a federation, the extension of veterans’ initiatives and how we continue with issues relating to the gathering and use of data, as was mentioned by the hon. Member for Strangford.
Mr James Gray
I strongly agree with much of what the hon. Lady has said in regard to veterans, mental health and a number of other things. However, I am a little unclear as to which part of the Bill she thinks can be amended to take account of the things that she proposes? For example, where will she get this proposed armed forces federation into this particular Bill?
Kirsten Oswald
I thank the hon. Gentleman for his intervention and for his positive words. As I mentioned earlier, there are important discussions around these areas that we must bring forward in Committee.
In conclusion, let us be ambitious for our armed services, our veterans and this important Bill. Let us work in Committee positively to improve the Bill, to probe and to debate so that we make real positive progress for our armed forces and veterans.
Mr Kevan Jones (North Durham) (Lab)
I welcome this Bill. As was said by a number of Members, including the Secretary of State and my hon. Friend the shadow Secretary of State, this is an important Bill in that it involves a key constitutional issue. This Bill might seem quite dry and boring, but it actually asserts Parliament’s control over the armed forces and the fact that we have a standing Army. I am sorry that the hon. Member for Dunfermline and West Fife (Douglas Chapman) did not understand the significance and importance of that. As he is new to the House, I may suggest to him very gently that if he does not understand something, it is perhaps better not to comment on it.
I am a veteran of Armed Forces Bills. I considered the Armed Forces Act 2006, which was a major Act in that it radically changed the disciplinary acts of the three services. Unfortunately, it then followed me into ministerial office in the Ministry of Defence. The constructive way in which that Bill Committee did some very detailed work over a number of months not only improved service discipline and brought the Acts into the modern day, but helped to address some of the public concerns.
The hon. Member for Portsmouth South (Mrs Drummond) talked about Deepcut, and the hon. Member for Strangford (Jim Shannon) mentioned the service complaints commissioner. Getting those issues into place has involved a long journey. We are now in a good place with regard to the service complaints commissioner. I was on the Defence Committee when Nicholas Blake compiled his report on Deepcut. I met the families involved on numerous occasions. Were they let down by the system, by Governments and by the Army? Yes, they were. Could we turn the clock back and find out what happened in those cases? Tragically, the answer is no, but what came out of the Blake report was a step forward in terms of the armed forces commissioner. I welcome the Government’s current commitment to the armed forces ombudsman. The Act tried, where possible, to apply to armed services personnel the modern standards that we would expect in civilian life. That is difficult because we are asking people to do different things. Where possible, the two areas should be mirrored. Clearly, the transparency that people expect in their dealings with Government should also be afforded to members of our armed forces. The ombudsman is a move in that direction.
The Bill before us is a piece of cake compared with the 2006 Act. It tidies up quite a lot of minor issues. As my hon. Friend the shadow Secretary of State said, we will support that, and ensure that those issues are scrutinised so that any unintended consequences are addressed. It is important that we send a message to the members of the armed forces that we are taking these things seriously. When they raise matters that they are not happy with, we should consider whether we can amend and change things for them. Obviously, I am not talking about interfering with the rigid discipline that is required or breaking the chain of command. The hon. Member for Portsmouth South (Mrs Drummond)—I must welcome her to the House and say that she is a vast improvement on her predecessor—made a point in that regard.
One issue that came up in the 2006 Act—it is a continuing one that needs to be addressed—is whistleblowing. I am not talking about whistleblowing for minor complaints or things that are not relevant. If members of the armed forces have serious concerns, there needs to be a mechanism, or a safety valve, in the chain of command—I know that the ombudsman will address some of this—so that these things can be dealt with. That is very important.
The worst thing that happened in previous years was that some complaints were not taken seriously—that has improved greatly—and delay added to the problem. Quite minor things should have been dealt with lower down the chain of command. Not only would people have felt that they had been treated better, but the bureaucratic outcomes for both the armed forces and the individuals would have been better.
We had seven contributions in this debate. I am not sure that many were on the actual details of the Bill, but I will touch on some of the remarks. Let me turn first to the hon. Member for Portsmouth South. I congratulate her son on graduating from Sandhurst. The academy does a fantastic job. She made a really important point, which is that we need to be proactive, not reactive, on issues. Those issues could include mental health, service discipline or just the way that we treat people. I also pay tribute to the work of Castaway House. I visited it when I was a Minister and saw for myself what a fantastic job it does in supporting veterans and the wider armed forces community in Portsmouth and the surrounding area.
We also had a contribution from my friend, the hon. Member for South East Cornwall (Mrs Murray), who paid tribute to the work of HMS Raleigh. I agree that the Royal Navy does a fantastic job there with its new recruits. One of the many highlights of my ministerial career was attending a passing out parade on HMS Raleigh. It is humbling to meet both the parents and the recruits and to see the dedication and hard work that goes into ensuring that those people are not only transformed in the short period that they are there, but given life opportunities to work within our armed forces, which many would never ever get.
The hon. Lady was a little bit naughty, which is unusual for her, when she referred to the nuclear deterrent. The hon. Member for Filton and Bradley Stoke (Jack Lopresti) also referred to the Labour leader’s position on the nuclear deterrent. May I reassure them that the Labour party policy on the nuclear deterrent has not changed? It was agreed at the Labour party conference this year that we are in favour of a minimal credible nuclear deterrent provided by four boats under the continuous at-sea deterrent. We are committed to ensuring that we are part of multilateral disarmament talks so that we get to that point that everyone in this House wants to get to, which is a reduction in the ownership of nuclear weapons.
Mrs Sheryll Murray
If the hon. Gentleman had listened to what I said, he would have heard that I referred to the continuous at-sea nuclear deterrent.
Mike Wood (Dudley South) (Con)
Will the shadow Minister explain how we could have a credible nuclear deterrent if we were to have a Prime Minister who had already said that he would never use it?
Mr Jones
It is up to the Prime Minister of the day to write whatever advice he or she wants in the letter to the commanders. The hon. Member for South East Cornwall said that our policy had changed, but it has not. It is very clear. End of story.
Labour Members past and present have contributed to the armed forces and I know that my constituency and those of many other Members make a tremendous contribution through their sons, daughters and others who work not only for the regular forces but for the reserve forces. I am proud to represent a constituency with a long history of connection with the forces, and long may it continue. I reassure everyone that I will ensure that I champion their interests and ensure that their welfare, which is important in terms of this Bill, is taken care of.
The hon. Member for North West Hampshire (Kit Malthouse)—I am not sure whether he is in his place—made an important point. The Bill refers to drug testing, but, as we all know, one of the biggest issues that needs addressing, which was an issue when I was a Minister, is alcohol. The question is how we address that, not in a nanny state way but by ensuring that people’s health is not affected by the drinking culture not only while they are in the armed forces but after they leave. Perhaps we could consider the question of alcohol and the armed services in Committee.
The hon. Member for Strangford talked about the contribution made by his part of the world to the armed forces as well as the idea of ensuring that people’s voices and complaints are heard. I, too, welcome the Government’s commitment to the service complaints commissioner.
We then heard three contributions from the Scottish nationalist party. I do not want to reiterate the issues about some of their points, but the Scottish nationalists cannot have it all ways. They cannot argue that they are committed to and want more defence resources for Scotland and then argue that an independent Scotland could produce even a fraction of what Scotland gets now.
I get a little disturbed when I hear the hon. Member for Dunfermline and West Fife use the phrase “the distribution of spoils in the UK” to refer to the armed forces, as though the defence of this country is somehow about moving resources around the country in such a crude way. It is actually about ensuring that the country is defended and has the capability to defend itself. He talked about warships never being based in Scotland, but conveniently forgot to tell the House that our submarine base and defence are in Scotland and that that would be put at risk if we followed the proposals to abandon the nuclear deterrent that he and his party want us to follow. The Scottish nationalist party should be honest in this debate and say that what is being proposed for an independent Scotland would not have anything near the footprint or the proud history that is there at the moment. He referred fleetingly to the idea of regiments, and the idea that the SNP would reinstate all those regiments in an independent Scotland is complete nonsense.
The hon. Member for Argyll and Bute (Brendan O’Hara) mentioned the White Paper on independence. I read it in detail, and not only its costings but its military strategy were complete and abject nonsense.
Bob Stewart
I thank my friend for allowing me to intervene. The Scottish nationalist party would have six battalions of infantry, which is twice the number pro rata that my constituents have in England. Pro rata, Scotland has twice the number of infantry battalions that English men and women have.
Mr Jones
I agree, which is why the White Paper was complete nonsense. Not only did the sums not add up, but there were no practical proposals to generate those forces from an independent Scotland. Scotland would have information, surveillance, target acquisition, and reconnaissance capabilities and other assets but would have no capacity, because of the numbers involved, to analyse what was collected or what its purpose was. For example, it would need fast jets and other things. It was just bizarre, to be honest.
Brendan O’Hara
Does the hon. Gentleman think it fair and equitable that Scotland has only 6.3% of the armed forces personnel, down from 7.1% in 2012?
Mr Jones
I know that the Scottish nationalist party wants to play up its victim mentality, which it has turned into an art form that I admire, but the idea to which the hon. Gentleman’s White Paper refers, which is that Scotland could provide the manpower needed for its proposals from the Scottish population, which is getting older, was absolute nonsense—[Interruption.] May I give him some evidence? He needs only to look at the recruitment to Scottish regiments when they were reorganised. Why was one regiment in Scotland—
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. We have moved way off the subject of the Bill. I understand that there is a desire to keep proceedings going, so I am not trying to pin it down to a tight debate, but I like to try to keep the debate on the subject of the Bill at least a little, so I am sure that the hon. Gentleman could mention it now and again. Given his experience, I know that that will never be a difficulty.
Mr Jones
I would refer, for example, to the recruitment of overseas nationals from the Commonwealth. The regiments that had to backfill with Fijians were the Scottish regiments because they could not get the numbers within Scotland. If the hon. Member for Argyll and Bute has some magic pool of people in Scotland who will suddenly join the armed forces or if there is some huge boom that will happen in the next few years that means that 18-year-olds and fit individuals will join the armed forces, I would like to see them.
Brendan O’Hara
The hon. Gentleman is not exactly doing the idea of the United Kingdom a great service. Indeed, he is pointing out everything that is wrong with the current system.
Mr Deputy Speaker
Order. I think we are now going to get back to the Bill. We have had enough playing around. Kevan Jones, have you finished?
Mr Deputy Speaker
That is all right then. What I will say is that you have finished on this point.
Mark Spencer (Sherwood) (Con)
I shall try to resist the urge to go off the point, Mr Deputy Speaker. The shadow Minister is a very experienced Member of Parliament and when he started his political career the world was a different place from what it is today. Does he recognise the necessity of having a much more flexible military system to deal with the threats that are evolving and changing in the world today?
Mr Deputy Speaker
Order. I think I might be able to help here. The hon. Gentleman might have been referring to the civil war as regards Kevan Jones, as he has been around for a long time, but we are not going to open up a debate about when he first got here and how the armed forces have changed.
Mr Jones
The hon. Gentleman makes a good point, however. It is not just the equipment and how we deploy things that has changed. The armed forces do not sit in a vacuum away from the rest of society, and that is one of the main issues for consideration. Things that were acceptable 20, 30 or 40 years ago for young people who joined the armed forces no longer are. When I was a Minister talking to senior military personnel, I heard that young people were far more questioning, although not in a disrespectful way, and more knowledgeable about their rights. They wanted to engage rather than take instructions. That is a challenge for the armed forces. We need to ensure that there are mechanisms in place for when things go wrong and, as I said in an intervention during the speech from the hon. Member for Portsmouth South, a safety valve to deal with complaints.
Mrs Sheryll Murray
The hon. Gentleman mentioned that as a Minister he visited HMS Raleigh. Does he agree that during the six weeks’ initial sea training, from the time they arrive until they pass out, a massive transformation occurs in those young people?
Mr Jones
Indeed. I have always said that. As the current ministerial team recognises, we should celebrate the life chances that membership of our armed forces gives young people. They get opportunities and skills that many of them would otherwise not have. That initial training is part of that ongoing process. It is not newsworthy to say that joining the armed forces is good for their career prospects, and what I am about to say might not be popular, but all the evidence suggests that it is good for their mental health as well. However, when things go wrong in service or after service, we need to make sure that mechanisms are in place to deal with that.
The hon. Member for Argyll and Bute (Brendan O'Hara) spoke about the armed forces federation, which might be relevant in that situation, although I am not sure how it would fit into the Bill. Clearly, this is the SNP’s latest campaign issue, but may I disappoint the hon. Gentleman? I got there first: I introduced a ten-minute rule Bill on that topic in about 2005. In other countries, as he said, such organisations work effectively, and provided it did not interfere with the chain of command, an armed forces federation could improve the system, as it does in other countries, by acting as a safety valve. Alas, having read the Bill, which I am not sure others have, I am not sure how we could get that into the Bill.
We will examine the Bill in detail in Committee and my hon. Friend the Member for Garston and Halewood (Maria Eagle) has outlined our approach. We will not oppose the Bill. Much of what it contains is sensible and includes a number of tidying-up measures. In any scrutiny process, it is important that any changes made do not result in unforeseen consequences, so in Committee we need to make sure that we road-test our ideas to destruction. I accept the assurance from the Secretary of State on the fire regulations. Those seem sensible, but it may be helpful if chief fire officers are asked for their views before the Bill goes to Committee.
I look forward to serving on the Committee for my third Armed Forces Bill. I am thankful that it will not be the marathon of the 2006 Bill. Our approach will be constructive, with the aim of ensuring the best outcome. Across the House, we want the best for our armed forces personnel.
The Parliamentary Under-Secretary of State for Defence (Mark Lancaster)
We have had a useful and interesting debate. It is a pleasure to follow a veteran such as the hon. Member for North Durham (Mr Jones). Compared with him, I feel like a mere newcomer as this will be only my second Armed Forces Bill. I am most grateful to hon. Members on both sides of the House for the contributions they have made and I thank them for their interest.
Unusually for the Ministry of Defence, this is the third piece of substantive legislation we have introduced in the past two years, the other two being the Defence Reform Act 2014 and the Armed Forces (Service Complaints and Financial Assistance) Act 2015. I am grateful to the hon. Member for North Durham for his positive comments as the ombudsman starts her new role early in the new year. It is not too surprising that the Armed Forces Bill we have introduced this year is relatively modest and focused mainly on the service justice system. Modest it may be, but that in no way diminishes the significance of its provisions, as it provides for the continuation of the single system of service law under the Armed Forces Act 2006 which applies to all members of the armed forces, wherever in the world they are serving.
As we heard during today’s debate, this Bill mostly covers a small number of issues relevant to the service justice system, plus the wider defence issue concerning statutory powers for MOD firefighters, which I will come to in a moment. Hon. Members raised a number of points about these proposals and also about issues that we have not included in the Bill. Indeed, much of the discussion seems to have been on issues that are not included in the Bill. I shall attempt to deal with as many of these as I can, and undertake to write to anybody to whom I fail to give an answer today.
My hon. Friend the Member for Filton and Bradley Stoke (Jack Lopresti) made a passionate and well-informed speech on behalf of the armed forces, based in no small part on his own service, to which I pay tribute. My hon. Friend the Member for South East Cornwall (Mrs Murray) has a long-standing family connection to the armed forces and asked some detailed questions about Devonport, about which I will write to her in due course. My hon. Friend the Member for North West Hampshire (Kit Malthouse) made a plea for more investment in technology. He may be aware of the announcement by the Secretary of State of an innovation fund as part of the strategic defence and security review, and the increasing work of the defence growth partnerships. I encourage him to visit Army headquarters in his constituency, which I would be delighted to arrange. In fact, I sense an invitation winging its way to him as we speak.
My hon. Friend the Member for Portsmouth South (Mrs Drummond) made a passionate speech. I am not sure I was entirely grateful to her for reminding me that it is 27 years since I went to Sandhurst, but I was cheered up to turn around and see my hon. Friend the Member for Beckenham (Bob Stewart). I think it may be a few more than 27 years since he went there. My hon. Friend the Member for Portsmouth South gave a powerful speech focusing on many areas of the military covenant, in particular mental health. This is a key area and she will be aware of the improvements that have been made in recent times, partly as a result of the “Fighting Fit” report by my hon. Friend the Member for South West Wiltshire (Dr Murrison). I join her in commending the charity Combat Stress, which was the first charity I visited after taking up my appointment.
I shall respond to the contributions from other hon. Members as I touch briefly on some of the clauses in the Bill, but only those that were referred to during the debate. In her opening comments the hon. Member for Garston and Halewood (Maria Eagle) raised the issue of visiting foreign forces being subject to the Act. I acknowledge her concerns and look forward to exploring the matter in Committee. I draw the attention of the House to the recent Westminster Hall debate on the unfortunate events at Bassingbourn, in which the current Government position was outlined.
Clauses 3 to 5 simplify the process of charging offences under the 2006 Act. Both my hon. Friends the Members for Beckenham and for Filton and Bradley Stoke sought reassurance about the role of the commanding officer. Commanding officers will continue to be concerned with probably over 90% of service issues. It will be only about 10% of issues that they will not deal with directly, but they will continue to be kept firmly informed of what is going on.
The hon. Members for Bridgend (Mrs Moon) and for Garston and Halewood asked why sexual assault was not included among the most serious offences in schedule 2. I want to make it clear at the outset that sexual assault is absolutely unacceptable in wider society or in the armed forces. Schedule 2 to the Armed Forces Act 2006 sets out the most serious disciplinary and criminal offences, including murder, kidnapping, grievous bodily harm and rape. A commanding officer must make the service police aware of an allegation or circumstance which indicates that a schedule 2 offence may have been committed. To move sexual assault to schedule 2 would make it a legal requirement for every allegation of sexual assault—an offence which covers a wide range of conduct—to be referred directly to the service police, whether or not the victim wanted that to happen.
We take the view that there are already processes and safeguards in place to ensure that victims of such offences are properly supported and that any allegations are properly investigated. All commanding officers are under a legal duty to ensure that all offences are investigated appropriately. Guidance given to commanding officers makes it clear when it would be appropriate to make the service police aware of an allegation. Guidance also sets out clearly the way in which these cases should be handled and the support that is to be provided to victims. We believe that the current legal arrangements and the guidance to commanding officers provide an appropriate framework for investigating these offences, but I accept once again that that could be discussed in Committee.
The hon. Member for Strangford (Jim Shannon) mentioned sexual harassment. This is as much about changing culture as it is about legislation. The Chief of the General Staff has made addressing issues of equality, diversity and inclusivity a priority in order to ensure that the Army is a modern employer that is capable of recruiting talent from all sections of society. The Army’s change programme on maximising talent, which the Chief of the General Staff launched on 19 June, demonstrates the progressive nature of the measures being taken to ensure that talent is able to thrive, regardless of ethnicity, gender or sexuality.
The survey was conducted between March and April 2014 and was sent to over 24,000 regular and reserve men and women, and over 7,000 responses were received. The overall conclusion from the survey was that there is an issue with an overly sexualised culture in which inappropriate behaviour is deemed acceptable. Although that does reflect wider society, the Army’s values and standards mean that it should not be accepted as the norm. I am delighted that the Chief of the General Staff is taking action to address that through his leadership code.
Clauses 14 and 15 deal with the powers of MOD firefighters in an emergency. I would like to reassure Opposition Members that the Chief Fire Officers Association was consulted and that the letter was published on its members’ forum, advising all chief fire officers in England and Wales of the provisions. Only Hampshire fire and rescue service responded, and it was positive about the provisions.
The hon. Members for Argyll and Bute (Brendan O'Hara), for Dunfermline and West Fife (Douglas Chapman) and for East Renfrewshire (Kirsten Oswald) all touched, understandably, on matters relating to Scotland. With regard to manpower in Scotland, there are currently 9,400 military personnel and 3,770 civilian personnel based in Scotland. The UK is delivering on a realistic plan for defence. The number of military personnel in Scotland is actually set to increase, but it is also likely to be affected by the SDSR, which will be published in due course.
The number of personnel at various locations across the UK, including Scotland, will fluctuate as the military make the necessary changes in unit moves to deliver the Future Force 2020 basing lay-down and target strength. The UK Government’s basing plans, which were announced last year, offer clarity and stability in our defence footprint in Scotland. That is a visible sign of our commitment to Scotland and to Scotland’s continued vital role in defence. On current plans, by 2020 Scotland will be home to all Royal Navy submarines, one of the Army’s seven adaptable force brigades and one of the three RAF fast jet main operating bases. Her Majesty’s Naval Base Clyde is already the single largest employment site in Scotland. Overall, employment figures will rise to 8,200 by 2020.
Hon. Members also touched on armed forces representation. Representation and safeguarding the wellbeing of service personnel are vital functions of the armed forces chain of command. The MOD recognises the British Armed Forces Federation and other such organisations as effective mechanisms by which the views of service personnel can become known. Service personnel are free to join them, provided they do not take a particularly active part in any political activity. To be honest, we are not aware of any groundswell of opinion from members of our armed forces that the remit of the armed forces federations should be extended or that they should be established on a statutory basis.
As I have made clear, the Bill is important to the armed forces, not least because it renews the legislation necessary for them to exist as disciplined forces. As the debate has demonstrated, it is also important to us here in Parliament, because it provides for our scrutiny of that legislation. That scrutiny is achieved by means of an annual continuation order, which must be approved by both Houses, and by primary legislation every five years.
I have a personal interest in this Bill. As a member of the reserve forces, I have been subject to the provisions of the 2006 Act, and many friends and colleagues still are. I also take very seriously the obligations that I have to the men and women who choose to abide by the high standards of discipline and behaviour that this Bill supports. I very much look forward to taking it through the House.
Question put and agreed to.
Bill accordingly read a Second time.
Armed Forces Bill (Programme)
Motion made, and Question put forthwith (Standing Order No. 83A(7)),
That the following provisions shall apply to the Armed Forces Bill:
Select Committee
(1) The Bill shall be committed to a Select Committee.
(2) The Select Committee shall report the Bill to the House on or before 17 December 2015.
Committee of the whole House, Consideration and Third Reading
(3) On report from the Select Committee, the Bill shall be re-committed to a Committee of the whole House.
(4) Proceedings in Committee of the whole House on re-committal, any proceedings on Consideration and proceedings on Third Reading shall be taken in one day in accordance with the following provisions of this Order.
(5) Proceedings in Committee of the whole House and any proceedings on Consideration shall (so far as not previously concluded) be brought to a conclusion one hour before the moment of interruption on the day on which proceedings in Committee of the whole House are commenced.
(6) Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion at the moment of interruption on that day.
Programming committee
(7) Standing Order No. 83B (Programming committees) shall not apply to proceedings in Committee of the whole House, to any proceedings on Consideration or to proceedings on Third Reading.
Other proceedings
(8) Any other proceedings on the Bill (including any proceedings on consideration of Lords Amendments or on any further messages from the Lords) may be programmed.—(George Hollingbery.)
Question agreed to.
ARMED FORCES BILL (SELECT COMMITTEE)
Ordered,
That the following provisions shall apply to the Select Committee on the Armed Forces Bill:
(1) The Committee shall have 14 members, to be nominated by the Committee of Selection.
(2) The Committee shall have power—
(a) to send for persons, papers and records, to sit notwithstanding any adjournment of the House, to adjourn from place to place and to report from day to day the minutes of evidence taken before it;
(b) to admit the public during the examination of witnesses and during consideration of the Bill (but not otherwise); and
(c) to appoint specialist advisers either to supply information not readily available or to elucidate matters of complexity relating to the provisions of the Bill.—(George Hollingbery.)
Business without Debate
(8 years, 6 months ago)
Commons ChamberRead Full debate Read Hansard Text
Alcohol Harm and Older People
(8 years, 6 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Fiona Bruce (Congleton) (Con)
It is a pleasure to be here and I welcome the opportunity to speak about the very real and damaging effects of alcohol harm on older people. I am pleased that the Minister for Public Health, my hon. Friend the Member for Battersea (Jane Ellison), is present and commend her for her passionate commitment to ensuring that key public health matters, and a strong preventive health agenda, remain high on the Government’s set of priorities for this Parliament.
I should perhaps clarify at the outset that I am seeking not to promote further legislation or regulation in this sphere, but to highlight the need for more education and information to help people make positive choices about their drinking; to enjoy it but at the same time maintain their own health and wellbeing. We all want to live longer—and we are—but, importantly, we want to live longer and healthier so that we can enjoy those later years. That is why this subject is so important.
Jim Shannon (Strangford) (DUP)
I thank the hon. Lady for giving way so early in her speech—I indicated to her before the debate that I intended to intervene. The theme that she is talking about, which many Members of the House, including me, would agree with, is this: everything in moderation. In other words, people should be careful about what they take and how often they take it.
Fiona Bruce
The hon. Gentleman is absolutely right. Although most people are able to drink in moderation and enjoy the benefits of the socialising and relaxation often associated with drink, for many others it comes with significant costs.
Before proceeding any further, I ought to clarify what I mean by “older people”. Depressingly, I am referring to those of us who are over 45. A huge amount has been done in the past few years to tackle excessive drinking by the young, and encouraging figures show that drinking among young people is falling. I am also referring not so much to binge drinking, which perhaps is what we all associate with drinking among young people, but to harmful drinking. That does not have to mean getting wildly drunk and being hungover the next day; it can be continuous drinking, perhaps every day of the week, which does not allow the body’s organs to have a break from alcohol. People are often unaware that that can be extremely harmful.
Alcohol is a leading risk factor for death and disease in the UK; it is the leading risk factor after smoking and obesity. As a toxin, it is the cause of many acute and chronic diseases, and—Members might be surprised to hear this—it affects almost every organ in the body. The relationship between alcohol and liver disease is well known, but alcohol is also a risk factor in a number of cancers, in cardiovascular disease and in gastro-intestinal diseases such as pancreatitis, and of course it is also a leading cause of accident and injury. On that topic, the all-party group on alcohol harm, which I chair, is currently conducting an inquiry into the considerable impact of alcohol on the emergency services. I look forward to being able to update the House on that work in due course.
Given its associations with so many and such serious health conditions, it is unsurprising that the impact of alcohol on NHS services is considerable. In 2012-13 there were more than 1 million alcohol-related hospital admissions, where an alcohol-related disease, injury or condition was the primary reason for the admission or a secondary diagnosis. As the Minister will be aware, the costs of this to the NHS are estimated to be at least £3.5 billion per year—on its own, more than a third of the Treasury receipts from alcohol—yet estimates for the wider personal, social and economic costs of alcohol vary from £21 billion to £55 billion in England alone. We therefore have much to address.
I must emphasise, though, that recent trends in the decline of underage drinking and drinking among young people are encouraging, which leads me to believe that we can similarly address and support improved positive drinking among older people. The proportion of 11 to 15-year-olds who have ever had a drink fell from 61% in 2003 to 38% in 2014, and the proportion of those who got drunk in the past week declined dramatically from 26% to just 8% in the same period.
Encouragingly, this positive trend is beginning to extend to the 18 to 25-year-old age group, many of whom, interestingly, now choose not to drink at all. That includes my own son, a young man in his 20s. He is a sportsman who simply does not drink. A huge amount of work has been done in this area. I commend the Government and their partnership working with many agencies to educate and support this age group to reduce levels of harmful drinking. One of the successes has been the introduction of street pastors. Another has been the presence of club hosts in clubs and pubs, where people on the “older sister” model, perhaps slightly older than those who might drink irresponsibly, will approach a young person they think is drinking too much and say, “Perhaps you need to think about how much you’ve drunk.”
Jim Shannon
I thank the hon. Lady for her comment about street pastors. In the past month, street pastors have started to be active in my constituency, with 13 churches and 43 volunteers coming together on this. That is a very clear commitment by community members themselves to address the issue. I recommend those in any constituency where there are no street pastors to ask the churches to be involved, because the benefits are great.
Fiona Bruce
I entirely agree. In my constituency, similarly, there are some excellent street pastor groups.
Voluntary organisations, the drinks industry, publicans and the police, together with local and national authorities, have done a huge amount to address drinking by younger people. With older people, though, much of their drinking is a hidden problem, particularly among the baby boomer generation who often drink at home, many of whom have a dangerously limited awareness of alcohol’s harmful effects. This is a ticking time bomb not just for the individuals concerned but in terms of the public cost of their healthcare in the years to come, with an increasingly ageing population.
According to the Health Survey for England 2013, 10 million people in England drink at a higher level than the Government’s lower-risk guidelines, with serious long-term implications for their health. This is particularly true of older people. Many of those in the baby boomer generation drink on an almost daily basis. The survey found that 14% of 45 to 64-year-olds drank alcohol on five or more days in the past week, compared with just 2% of their younger counterparts in the 18 to 24-year-old group. Alcohol-related hospital admissions among this middle-aged group account for 40% of all alcohol-related hospital admissions and 58% of all admissions for alcoholic liver disease. Tragically, this age group also accounts for the majority of alcohol-related deaths.
Some of the impacts of alcohol are rather less obvious but no less devastating. For example, there is a significant link between alcohol use and the risk of hypertension, which is a factor in a number of related illnesses such as stroke, heart disease and other vascular diseases. Alcohol is generally associated with poorer mental health. In later life, alcohol can be used as a comfort for many of the shocks that people experience in middle age, such as adjustment to life after divorce, redundancy, retirement, children leaving home, or bereavement. Loneliness or depression can also be a factor. These points in life can be very challenging, and they are all associated with higher rates of alcohol use. People need to be made aware that when these life shocks hit them in later life, as they do the majority of us, they need to look out to avoid slipping into harmful drinking patterns because the consequences can be catastrophic in just a few years.
The majority of older people are not aware of the potential damage they are doing to their health or relationships through unhealthy drinking. Office for National Statistics figures show that the greatest number of people who did not drink but now do drink are women over 65, many of whom live alone. That is a particularly concerning statistic that we need to bear in mind. Research by charity Drinkaware and by Ipsos MORI suggests that there is a large group of people who are sleepwalking into poor health. Only 20% of 45 to 65-year-olds think they will have health problems if they continue to drink as they do, yet more than a third are drinking at above the level of Government guidelines. Shockingly, one in nine says that they have already been told by a friend, family member or health professional that they should cut down.
Interestingly, this issue was raised in the previous debate—I do not think the Minister was here—when the shadow Defence Minister, the hon. Member for North Durham (Mr Jones), spoke about needing to address it for those who had been in our armed services, although not in a nanny-culture way. I strongly echo that.
For many, drinking is an everyday occurrence, but when confronted with it, people do not realise that even drinking at relatively low levels but on a continuous—that is, virtually daily—basis can be harmful. Here is a typical comment:
“On reflection when you look back it’s not the fact that I drink to get drunk constantly—that would be a separate issue…but as part of the relaxing process…on a daily basis at home. I just didn’t realise how many excuses I have to…drink.”
Misuse of alcohol has a devastating impact on relationships and families, and on children in particular. That should be given greater prominence. In 2012, a survey by the Children’s Commissioner, “Silent voices: supporting children and young people affected by parental alcohol misuse”, estimated that between 1999 and 2009 more than 700,000 children were affected by parental or other significant adult drinking. It said that parental alcohol misuse is far more prevalent than parental drug use and called for a greater emphasis on it in policy and practice. It is a matter of social justice that we address this, not just for children but for the poorest in our society, because research shows that those who are less well-off are less resilient and more vulnerable to the impact of harmful drinking. Professional people, some of whom drink more, are able to withstand the impacts better.
As chair of the all-party group on alcohol harm, I urge that greater prominence be given to this issue, particularly to the harms caused to older people. A number of strands could be taken forward, alongside other initiatives that I am sure the Minister will consider. One very practical example was given in an excellent report that I had the privilege of launching here in the House last month: “Under Pressure” by the Treat 15 Expert Group, which comprises doctors, nurses and other health professionals. It suggested that whenever an individual has their blood pressure taken, mention could be made, just in those few minutes, of drinking being linked to the risk of high blood pressure, and indicators of the harmful health implications associated with that. It is estimated that about 7.5 million people in this country are at risk of high blood pressure. Just identifying the link with harmful drinking could help a large number of people to improve their health prospects. In those few moments, often when nothing else is done or said, there is a real opportunity, at no cost at all, for the medical profession to provide an important service.
There is also an urgent need for public education on the harmful effects that drinking can have on older people. People need information that is simple, accessible and non-judgmental. There are some innovative resources, such as the Drinkaware app and the Change4Life booze buster programme, which help people make informed choices about their drinking and support them to make a change that could have significant benefits for their health and wellbeing.
We also need more prominent, comprehensive and consistent public health messages from Government, the NHS and Public Health England about the risks of harmful drinking. A report will be released shortly and I look forward to reading its suggestions as to how the issue can be addressed. Given that people are living longer, it is important that they are informed about how to live healthier longer lives.
The alcohol industry also has an important role to play by working in collaboration with others. It is a key partner and has made a great deal of progress working in partnership with pubs and clubs and with the Government. The Government challenged the industry to remove 1 billion units from the alcohol market over two years. In fact, 1.3 billion units were removed—the equivalent, apparently, of the whole nation going dry for one week a year. One of the means by which that was achieved was through providing house wines of less alcoholic strength and smaller glasses. I also commend the industry for the fact that almost 93% of alcohol bottles now warn women that it would be better for them to consider not drinking during pregnancy.
Jim Shannon
There has been talk in the press over the past two weeks about the best message to give to pregnant women about alcohol consumption. Does the hon. Lady agree—perhaps the Minister will say this in her response to the debate—that the best message and policy would be that pregnant women should drink no alcohol whatsoever?
Fiona Bruce
That is my personal view. Women have suffered from mixed messages over the past 20 years and more. It would be very helpful to have a clear message. Just six years ago, only 17.6% of products carried a warning label about drinking in pregnancy; the figure is now 93%. I would like it to be 100% and it would be very helpful if the Government gave a clear message that not drinking in pregnancy is probably the wisest choice of all for the woman and her child.
In conclusion, I ask the Government to consider working in partnership with us to develop strategies to reduce alcohol-related harms in older people, just as they have done, with some success, to reduce unhealthy drinking in younger people. No one now questions the role of Government in promoting healthy eating. The same rule could, I hope, be undertaken in future, with similar, commendable vigour, by the Government with regard to encouraging healthy drinking.
The Parliamentary Under-Secretary of State for Health (Jane Ellison)
It is delightful to be here, a little earlier than expected, for this important debate on alcohol harm and older people, and I congratulate my hon. Friend the Member for Congleton (Fiona Bruce) on securing it. She laid out extremely clearly some of the challenges we face.
Alcohol is one of the four biggest behavioural risk factors for disease and death in the United Kingdom, along with smoking, obesity and lack of physical activity. As my hon. Friend alluded to, it is also a significant contributor to some 60 health conditions, including circulatory and digestive diseases, liver disease, a number of cancers and depression. That evidence base is growing all the time, and it is important that we highlight that. Drinking can lead to a range of conditions and, as she said, it is estimated to have contributed to more than 1 million hospital admissions in 2013-14, costing the NHS a considerable amount of money. Much of that burden of disease and death is preventable. To this day, people continue to be affected by alcohol misuse, so it is right that we give the matter our attention. A lot of that is because of ignorance and misunderstanding, and because we perhaps do not talk about it as much as we should. My hon. Friend is also right to say that getting the tone of the debate and the advice right is sometimes a challenge.
There is a lot of interest in the issue in Parliament, and we have also heard about how alcohol misuse can have a significant and devastating impact on the lives of our constituents. I am sure that all parliamentarians present will have met people who, if they are not themselves personally affected, have seen their family affected by alcohol misuse. It is very sad when we see that.
Many of the concerns were set out in the all-party group on alcohol harm report earlier this year, and I congratulate the group on that work. Obviously, I have met affected individuals and I have read many letters sent to me by colleagues detailing the concerns and frustrations of those who see the cost of alcohol harm and the impact it has on their everyday lives. They want action to be taken right across public life, including from Government, industry and beyond.
The majority of people who drink alcohol do so in an entirely responsible way. Although I welcome recent falls in alcohol consumption, we cannot be complacent, which I certainly am not. There are still many who drink above the lower-risk guidelines. As my hon. Friend has said, Office for National Statistics data suggest that the proportion of over-65s who are drinking above those lower-risk drinking guidelines is increasing. Harms such as liver disease, as well as the social impacts such as crime and domestic violence, remain much too high. This is an important public health issue, to which I continue to give attention. I regularly meet Department of Health officials to ensure that progress is maintained on cutting the number of people of all ages drinking at harmful levels. Before closing, I will touch on occasions in the next few months when we might pay particular attention to that topic.
A number of actions have already been taken. For example, sales of alcohol below the level of duty plus VAT were banned in May last year, to tackle the worst cases of very cheap and harmful alcohol, meaning it is no longer legal to sell a can of ordinary lager for less than about 40p.
In the last Parliament we worked with the industry to take alcohol units out of the market. As my hon. Friend said, more than 1 billion units were taken out of the market. I have challenged industry to build on that: it is a good start, but we can go further and I have had discussions about what that new effort might look like. We can do more to make sure that we have the widest range possible of lower strength drinks available to the public. Some of the simple substitutions my hon. Friend has mentioned can make a considerable difference to help bring people back to lower-risk drinking.
We have also introduced an alcohol risk assessment into the NHS health check. It is aimed at 40 to 74-year-olds. Health checks provide a chance to identify and manage a range of risk factors, such as high blood pressure and cholesterol levels as well as alcohol consumption. They enable identification and brief advice interventions to be provided in primary care and, indeed, non-health care settings. We know that that can work, with one out of every eight people who receive an intervention to help them moderate their behaviour responding to it. Since April 2011, 5.6 million people have taken up the offer of a health check, and I continually challenge the system to build on that, because it can provide a reality check for many people who have not noticed harmful drinking creeping up on them. That is really important.
All health professionals have a public health role and we need to make sure that the system has enough capacity and that our workforce are adequately trained to tackle challenges such as alcohol misuse and, of course, drinking in pregnancy, which we have debated often in this House. There is keen interest in the issue and perhaps we will return to it in more detail when we consult on the revised guidelines, which I will mention in a moment.
Since April, the standard general medical services contract has included delivery of an alcohol risk assessment to all patients registering with a new GP. That is another important moment at which people think about their health and there is a chance to have such a conversation afresh. That assessment has the potential to raise awareness of alcohol as a risk factor with a large percentage of the population. By 2018, about 60,000 doctors will have been trained to recognise, assess and understand the management of alcohol use and its associated health and social problems. It is important that in future doctors can give better advice on the health impact of the effects of substance use and misuse.
The Government have given local areas more powers and responsibilities to help them tackle harm in their populations. We have backed that with ring-fenced budgets to improve people’s health, and that includes responsibility for tackling problem drinking. We have given local authorities more than £8 billion in funding over three years. As I have seen during my many visits as the Minister with responsibility for public health, local authorities are very well placed to take forward the public health role. They know their communities well, often at a level of detail that the Government could never understand, and they know where to put the right services to help their communities.
The Government have continued to work with Public Health England, which is giving higher priority to alcohol issues. In looking at alcohol during the next 18 months, PHE will examine how a whole-system approach might provide a focus, particularly on return for investment. Local authorities are keen to make sure that they spend money wisely and that their budgets yield good results. That is no less true for public health than for anything else. The work is intended to assist the Government, local authorities and the NHS to invest with confidence in evidence-based policies, prevention and treatment interventions. Public Health England’s support for local authorities’ public health role will continue to be vital. I do not want local authorities to try to replicate the evidence base that national experts obtain. Such experts should provide the evidence base, and local authorities can then be in the position to take it, adapt it to the local needs and build on it.
To help local areas to target and tailor their activities, Public Health England has developed both liver disease and local alcohol profiles. Those are very important tools to put in the hands of commissioners and those who know their communities best. The profiles provide transparent, comparable information to health and wellbeing boards, commissioners, service providers and professionals, letting them look at their own performance and, importantly, at that of others to see how to improve their outcomes.
PHE will also expand the Healthier Lives web tool, which includes indicators on alcohol hospital admissions and figures for waiting times and completions of alcohol treatment. That will allow an area to build up a complete picture of how well it is doing, particularly against national averages and comparable areas. As in all things in the world of public health, there is considerable local variation—the challenges are not all the same in different areas—so we need to give local areas such tools. We have seen good practice in Lancashire, which has used local alcohol profiles to inform its joint strategic needs assessment and to look at the mix and quality of the services it commissions.
Fiona Bruce
The Minister is quite right about variation. One of my concerns is about the increase in drinking among older women. Is anything being done specifically to look at how they can be helped to reduce the effect of alcohol harm?
Jane Ellison
I will come on to matters relevant to that, but I will also say more about a possible opportunity for a wider debate on this important issue a bit further down the line.
It is important to consider what can be done through secondary care. About 139 district general hospitals already offer some level of specialist alcohol service. I saw for myself such specialist work when I visited Blackpool in 2014. One team told me about how it took the opportunity of people being admitted for something related to alcohol to talk to them about their drinking. They described, with huge understatement, as a “teachable moment” the time when someone is in hospital having suffered, either through a disease or an accident, an unfortunate effect from alcohol. They are right: the idea of talking to people at the moment when they are most receptive is vital.
We would like to have similar alcohol care teams in every hospital to take such opportunities to identify the problem and provide brief advice to patients, as well as medical management. That is again based on the evidence that higher-risk and increasing-risk drinkers who receive brief advice are twice as likely to have moderated their drinking six to 12 months after an intervention—a quick response—compared with drinkers who get no intervention. We want greater use of such really good opportunities. It is not costly or, indeed, lengthy; it is about timeliness.
There are means for people to monitor and manage their own alcohol intake. Technology is increasingly deployed to good effect in a number of areas of personal health monitoring, and alcohol intake is no different. Apps such as the one developed by Drinkaware, which my hon. Friend mentioned, can help people to track how much they are drinking, what it costs them and even the number of calories. We know that personal estimates of weekly drinking are not always as accurate as keeping a log. That is quite well documented, so individuals may find apps and tracking mechanisms particularly helpful.
The Big Lottery Fund, in partnership with the support charity Addaction, is investing £25 million in an alcohol-related harm prevention and awareness programme for the over-50s. Rethink Good Health is a UK-wide programme aimed at those aged 50 and over. My hon. Friend very thoughtfully explored some of the reasons why people may find themselves in such a situation in later life. We would recognise from our constituency case load and perhaps from our social circles how life events can take a toll on health and lead to people drinking more. She mentioned some of them, but I would highlight how such problems can be a driver, and sometimes a product, of loneliness and isolation.
As the House will know, Dame Sally Davies, the chief medical officer, is overseeing a review of the lower-risk alcohol guidelines to ensure that they are founded on the best science. We want the guidelines to help people at all stages of life to make informed choices about their drinking. The guidelines development group, made up of independent experts, has been tasked with developing the guidelines for UK chief medical officers to consider. The group has researched and is developing a proposal on the guidelines, including a UK-wide approach for guidance on alcohol and pregnancy. We expect to consult on that.
I know that that is an issue, and that there are worries about people receiving different advice, so let me say a word about the consistency of health messages. As I have said before at the Dispatch Box, where the evidence base is not completely certain—leading experts to reach slightly different conclusions—there will be a certain level of debate. I appreciate that that can be extremely challenging for the public and that there is a role for trying to provide clarity, but guidance must always be based on the best evidence base.
Jim Shannon
The Minister knows that Members of this House, myself in particular, have the utmost respect for her and her position, for what she does and for the guidance she gives. However, the very possibility of uncertainty poses an important question for us. The message must go out from the Minister and from us as elected representatives that during pregnancy, there must be no alcohol at all. That has to be evidence-based, as she said, but there should be the same message so that there is no uncertainty.
Jane Ellison
The UK chief medical officers are extremely alive to that challenge and it is something to which they have given considerable thought. Perhaps we will return to it when the guidelines are consulted on. I assure the hon. Gentleman that I have had that conversation and that I have been at pains to emphasise how regularly the issue comes up in Parliament. I know that it is being addressed and that it will be talked about when we consult on the new guidelines.
It is clear that there is more that all of us can do. We have to recognise the contribution that not just individuals, but businesses, communities and local government can make to help people better understand the risks associated with alcohol. I agree with my hon. Friend the Member for Congleton that we need to do more. We are working to ensure that there is a better understanding of the risks.
This is an issue to which we will return. The publication of the new alcohol guidelines will provide a moment in the national debate when we can look at it closely with the public, experts, health professionals and industry. That will be a stimulus to fresh thinking, more public education and debate. Those in Parliament who have a particular interest in the issue will want to participate in that important debate. However, change will not happen overnight. I know that the hon. Members who are here will agree that raising awareness of the issue is key. We have an evidence base to show that, in some cases, raising awareness with individuals is the most important thing we can do to help them.
This debate has been an important opportunity to revisit these important issues. We will return to them in more detail in the coming months. That will be a great opportunity to reflect not just on the good progress that we have seen among younger people, but on the work that we are yet to do.
Question put and agreed to.
Draft Byelaws (Alternative Procedure) (England) Regulations 2015
(8 years, 6 months ago)
General CommitteesRead Full debate Read Hansard Text
The Parliamentary Under-Secretary of State for Communities and Local Government (Mr Marcus Jones)
I beg to move,
That the Committee has considered the draft Byelaws (Alternative Procedure) (England) Regulations 2015.
It is a pleasure to serve under your chairmanship, Mr Bailey. The purpose of the draft regulations is to put in place new arrangements for the making, coming into force and revoking of certain byelaws, in particular to put in place new arrangements that remove the requirement for byelaws to be confirmed by the Secretary of State. Byelaws are local laws, made by local authorities, requiring something to be done or not to be done in a particular location. If properly made, they have the force of law, and contravention of a byelaw is prosecuted through the magistrates courts, usually resulting in a fine.
To be clear, the byelaws to which the new arrangements will apply are ones for which my Department has policy responsibility. Other Government Departments have responsibility for their own types of byelaw. Such byelaws are not included in the new arrangements, but if other Departments want to adopt alternative arrangements in future, they may seek to legislate to do so.
All byelaws should address a specific local need, should be proportionate and should be robust and enforceable. The current arrangements for the making of a byelaw are that once a local authority has decided that a byelaw is required, it will make and seal the byelaw and then advertise it in a local newspaper. A month-long consultation follows, during which the public may make representations to the Secretary of State about the byelaw. If the local authority wants to proceed with the byelaw following the conclusion of the consultation period, it applies to the Secretary of State to have the byelaw confirmed. In considering whether to confirm the byelaw, the Secretary of State will consider any representations and the local authority will have the opportunity to respond to any objections. Once the byelaw is confirmed, it comes into force one month after the date of confirmation, allowing the local authority time to arrange for new signs to be put up.
The process for revoking byelaws is the same. To revoke a byelaw, a new byelaw needs to be made, consulted on and confirmed. In practice, local authorities undertake several non-statutory steps to prepare the byelaw before making and advertising it. They are expected to consult interested parties and those who will be affected by the byelaw. They are also expected to ensure that the byelaw is reasonable and legally robust.
Removing the Secretary of State’s confirming role in the making and revoking of certain byelaws continues the process of moving power away from Whitehall to local authorities and the public. The checks and balances underpinning the new framework, including consultation and engagement with interested and affected parties as part of the assessment, and preparatory work when a local authority is considering making the new byelaw, will result in robust, proportionate byelaws that are supported by the local community. Moreover, the new arrangements include statutory engagement and consultation with the local community, helping to inform the shape of the byelaw.
Mr Steve Reed (Croydon North) (Lab)
I understand from what the Minister is saying and what is proposed in the legislation that the Secretary of State’s role will shift from giving consent to a byelaw after the public consultation to giving approval before the public consultation. Why is that materially different? The Secretary of State’s role is still firmly entrenched in the approval process. That is markedly different from the situation in Wales following the passage of legislation in 2012 that removes entirely the approval role of either the Secretary of State or the Welsh Government for byelaws made by local councils in Wales. Will the Minister explain why councils, local authorities and other bodies that can pass byelaws in England should not have the same advantages as those equivalent bodies in Wales?
Mr Jones
Creating a byelaw is an extremely important process that can
be challenged in a court of law once the byelaw is tested, so, by definition, we need to ensure that byelaws are proportionate to the issue that they are there to solve. We need to offer the public a check and balance in relation to the byelaw doing what it says on the tin.
I hear what the hon. Gentleman says about the angle of devolution. We are devolving more powers with these regulations because at the end of the day it will be not the Secretary of State who finally signs off the byelaw but the local authority in question. As he identified, all the way through the process there will be a check and balance, once the byelaw has been consulted on in the local area.
Mr Jones
I have just responded to the hon. Gentleman’s concerns on that point. It is important that we ensure that the people of England have the assurance that byelaws have been made in a robust way and that there is that check and balance. If the devolved Assembly in Wales decide not to do that, that is their prerogative. The changes before the Committee were instigated by the Labour party when it was in government. If I am not mistaken, apart from some changes that we have made over the past year or so in relation to introducing the proposal to the House, it is actually quite similar to the proposal advocated by his party when in government, so I am surprised that he is challenging it now.
The regulations will put in place new arrangements for the making of certain byelaws without those byelaws having to be confirmed by the Secretary of State before they come into force. Under the new arrangements, to make a new byelaw a local authority will first undertake an assessment of the byelaw and consult on it. The local authority will have to assess the need for the byelaw, consider whether the aim of the byelaw can be achieved in any other way, and assess the effect of the proposed byelaw on those affected by it.
As part of that deregulatory assessment, the local authority must consult such persons as it considers may be affected by the proposed byelaw, which, crucially, may include persons who are not resident in the authority itself. That is particularly important in relation to byelaws concerning parks, recreation grounds and the sea front, where those visiting may not be local residents.
The requirement to undertake a deregulatory assessment and a consultation with interested parties will ensure that the proposed byelaws are informed and shaped by that preparatory work, and should ensure that the local authority does not encounter any substantive objections at the public consultation stage. Unlike under the current regime, it will ensure that objections can be dealt with before the local authority has spent money advertising the byelaw in a local newspaper.
Once the local authority has completed its consultation and prepared a deregulatory statement, it may apply to the Secretary of State for approval to proceed with the byelaw. The Secretary of State must respond within 30 days, and may give leave to the local authority to proceed with the byelaw-making process, or refuse to give leave. Recognising that byelaws can be complex and contentious, the Secretary of State also reserves the right to advise the authority that a substantive response will be issued as soon as practicable, allowing time for careful consideration of the application.
Once approval to proceed has been given, the local authority will publish the proposed byelaw, advertising it in a local newspaper and on its website, if it has one. The public may then make representations about the byelaw. It is then for the local authority to consider representations from the public before making a decision to proceed with the byelaw. The council may decide to make the byelaw, not to make the byelaw or to make the byelaw with a minor modification. The byelaw comes into effect one month after that decision is made.
The new arrangements make revoking a byelaw a more straightforward process than at present, while recognising that community involvement in the process is still important. Accordingly, when a local authority revokes a byelaw—this partly answers the hon. Gentleman’s question—the authority will still need to make an assessment and prepare a draft byelaw and will still need to consult the community and publicise the revocation. It will not, however, have to undertake a number of the steps required to make a byelaw, such as undertaking a deregulatory assessment. Crucially, the Secretary of State plays no part in the revocation process.
The regulations also make explicit provision for local authorities to retain byelaws after they have made them. If a byelaw exists to prohibit or restrict an activity in a certain area, it is right that the public can see that byelaw. The regulations also make provision for local authorities to share copies of their byelaws. Parish councils can make byelaws within their boundaries, but those boundaries will also be in a local district, county or unitary council area.
The regulations also make provision for those local authorities that are already advanced in the byelaw making process using the current arrangements. They will not have to start again from the beginning. Transitional arrangements ensure that if a local authority has made its byelaws—the byelaws have been drafted and the council has decided to make them—those byelaws will be dealt with using the existing system.
Before concluding, I will address the points raised by the Secondary Legislation Scrutiny Committee. The Committee remarked that the explanatory memorandum makes no reference to the earlier version of the regulations that were laid on 26 March and subsequently withdrawn, or why my Department laid regulations in 2015 to put in place a policy that was announced in 2011. After considering the regulations laid on 26 March, we concluded that they could be improved, and these regulations represent that improvement. For instance, if a local authority wishes to make a major amendment to a byelaw after consultation and before finalising the byelaw, it must consult once again on that major change. We also removed the requirement for a local authority to advertise the byelaw not only as part of the consultation process but when the byelaw was to come into force, which on reflection we considered burdensome.
As to the timetable, I hope that we all understand that, although they may apply to a small local area, byelaws can make a big difference to people’s lives. Getting arrangements that make those byelaws right is important. It has taken time, but we consider that the regulations in their present form are the right ones to put in place and contain the right arrangements to make proportionate byelaws for the benefit of the community.
The new byelaw making and revoking arrangements move the decision on whether a byelaw comes into force away from Whitehall and towards local authorities and the public. The new arrangements ensure that new byelaws will be proportionate and reasonable and make it easier for local authorities to revoke out-of-date or unnecessary byelaws. The new arrangements are also suitable for all byelaw-making local authorities. From the largest metropolitan council to the smallest parish council, the process is the same.
Mr Reed
I thank the Minister for his introduction, but I still consider the legislation to be pretty weedy. It makes such small changes that I wonder whether it even merits the cost and time that has gone into putting it together and bringing it here. Whether the legislation originated from a previous Government or the current Government does not matter much to me if it does not do what it could do. The present Government are bringing it forward, not the Government who left office over five years ago.
By allowing a difference to continue between the powers over local government and other authorities in England and their equivalents in Wales, the Government are showing and saying that they do not trust local authorities in England as much as they do those in Wales. That seems a bizarre position to entrench in legislation, but it seems to me to be all of a piece with a Government who like to talk local but act central because they are too timid to act on what they say they want to do. I wish they would find the courage sometimes to just let go and let things happen.
In the grand scheme of things, byelaws are not incredibly significant pieces of legislation. They are certainly important where they operate, but we ought to be able to trust local government enough to take decisions about the very restricted areas in which they are able to operate. They should not have to have the approval of the big boss sitting in Whitehall for every little decision that they take. Giving communities a bigger role is always welcome, but that will not happen with these regulations.
The Secretary of State’s role has been moved from giving approval after the public consultation to giving it before the public consultation. The point is that the Secretary of State’s role is still firmly entrenched in the process and byelaw legislation cannot proceed without his consent. Shifting his role from one point in the process to another is not localising the decision; it still has to go through the Secretary of State in Whitehall, which is a shame.
In Wales, the Local Government Byelaws (Wales) Act 2012 removed the Secretary of State and the Welsh Government from any role in the passage of byelaws in the Principality. Regrettably, in 2012 the UK Government took the case to the Supreme Court to try to prevent such an act of localism from applying in Wales, just as they do not intend to grant permission for it in England; happily, they lost. On that basis, I would have thought that the Minister might have reconsidered the nature of the regulations and perhaps sought to remove entirely from the framework that he outlined the role of the Secretary of State in the passage of byelaws, except perhaps in the case of a local authority disregarding or not taking into account significant objections from local people affected.
The regulations could have done a lot more than they currently will. Even worse, they are directly contradictory to the localist credentials that the Government like to claim for themselves.
Mr Jones
The regulations will make significant changes to the making of local byelaws. I hear what the hon. Gentleman says about the devolved Administration in Wales, and we have looked at the situation extremely carefully. Later on in his speech he came round to saying that there should be some sort of check and balance in the system for putting byelaws into place. We consider the changes to be significant, while still providing for that check and balance to ensure that the byelaws being made are proportionate. They will mean that, rather than the Secretary of State considering representations and making his or her mind up about whether a byelaw is good or bad, the local council will have the chance to deal with representations from local people and listen to local views. Under the new system, there is no obligation for the Secretary of State to confirm the byelaw, so his or her role will be more light touch.
The hon. Gentleman does get what he asks for on the revocation of byelaws. The Opposition do not always like to get rid of unnecessary legislation and like to continue to make as much legislation as they possibly can, but if a local area thinks that it has an unnecessary byelaw, it can revoke it without confirmation from the Secretary of State and without having to jump through all the hoops.
Mr Jones
I have heard what the hon. Gentleman says, but I have set out, at some length, why the Government do not intend to do that. Confirmation from the Secretary of State is important for local communities, particularly given the hon. Gentleman’s comments about the need for checks and balances. It is important that the process is being followed correctly. We have to understand that the Secretary of State’s involvement is more about checking that the process has been conducted properly, rather than saying to a local area that a certain byelaw can or cannot be made. If the hon. Gentleman cared to consider the legislation in its intended spirit, he would realise that the proposals are extremely good and give significant powers back to local areas and local people.
Question put and agreed to.
Trade Union Bill (Third sitting)
(8 years, 6 months ago)
Public Bill CommitteesRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Chair
We start by considering the motion to make an amendment to the programme motion. I remind Members that the Standing Orders provide that the Minister may move such a motion and that if any member of the Committee signifies an objection, the proceedings on the motion will lapse.
Ordered,
That the Order of the Committee of 13 October 2015 be varied by the insertion of “; NASUWT” at the end of the third column of the 13th row (Thursday 15 October Until no later than 3.00 pm) of the Table in paragraph (2).—(Nick Boles.)
Examination of Witnesses
Deputy Chief Constable Charlie Hall and Steve White gave evidence.
The Chair
Our two witnesses are Steve White, who is chair of the Police Federation of England and Wales, and Deputy Chief Constable Charlie Hall of the National Police Chiefs Council. You are both very welcome.
Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)
Q 242242 Good morning and welcome to the witnesses. There is a serious number of provisions in this Bill, particularly in relation to picketing. One of the consultation documents contains proposals on supervising social media comments and potential criminalisation, although we are not clear on the Government’s position on those issues. Do you believe that there are problems with the way in which the Bill could be policed and the additional stresses and strains it would place on policing, which is obviously already subject to significant pressures?
Deputy Chief Constable Hall: In the majority of cases, there is no real need for the police to be involved with industrial disputes and picketing. Indeed, our stance is that we would wish to avoid it if we can. Many pickets and industrial disputes run without any contact or involvement with policing. Clearly, there are occasions when police have been, and need to be, involved to keep the peace and prevent disorder. There are provisions in the Bill for police to be notified of picket lines, and my reading of that is that, in pretty much every instance, we would be notified of industrial disputes and picketing. My position is that I do not see that as absolutely necessary, simply because we would expect those picket lines to be self-policing as far as possible. Involvement of police beyond that should be the exception, rather than the rule.
On social media, I have seen some detail in the Bill about that. I do not believe that there is a need for the police to be able to vet or censor social media posts. Clearly, there may be a role for policing at some point. If things are posted that commit criminal offences, we would investigate in the same way that we would investigate other social media posts.
Stephen Doughty
Q 243 Steve, do you share those views?
Steve White: Yes, broadly. There needs to be a recognition of what is practically possible in terms of the level of resource that we currently have, particularly on the social media aspect—goodness gracious me. I am on Twitter, and I sometimes wish that perhaps we did have the powers to deal with social media comments from time to time, but, goodness me, that would be massively complex. From a policing perspective, it would be a dangerous route to start going down if we say that the police should have a role to play in that.
Of course, the relationship between local police officers and employees of local firms is key and crucial to this. It would be a travesty if we ended up going back to the days of the 1970s and ’80s when, whether rightly or wrongly, the police service was seen as an arm of the state, which of course we absolutely are not. I certainly echo Charlie’s comments that these disputes should be largely self-policing.
The only other comment that I would like to make is about the requirement to inform police in relation to picket supervisors, for example. I question that. I mean, it is not for the Police Federation to say what laws there are in the country, of course. However, I personally question whether there would be more appropriate ways for that information to be recorded, so that the police absolutely do not have to be involved at all, apart from keeping the peace when necessary. Perhaps local authorities could play a part in that more appropriately. And of course, the sad fact of the matter is that we are now seeing increasing mission creep, whereby the police service has to step in where other services are providing gaps. So we do not want to design something that brings that about, when perhaps there are more appropriate agencies to do that work.
Stephen Doughty
Q 244 Given what you have said, do you both think that there is a risk that with some of the provisions—particularly those about being able to demand letters, anyone being able to demand a letter, the wearing of armbands and all sorts of stuff—that if things got out of hand, they could draw the police into situations where multiple people demand things? As you say, preferably, the police should stay out of these situations. Do you think that there is potentially a risk of a breakdown in order around protests that otherwise would have been conducted and self-policed, as you have described?
Steve White: The point is that if there is a requirement for a notification to be made to the police, what happens when that does not happen and how do you know if it has not happened? Presumably, the police will have to investigate that. That is the issue. Otherwise, there is no point in having that requirement; it is about enforcement.
I think that it is justified for us to have a view in relation to the practicalities of enforcement, because we are the ones who are charged with enforcing the laws. So I think it is right for us to be able to comment on that. My question is: what would the sanction be? Then, of course, immediately you will drag the police service into other aspects, which I am not convinced is the intention of the Bill. It is the mission creep element.
Deputy Chief Constable Hall: I think that my response to the question would be “possibly”, but I would not over-emphasise that it will cause problems. When police need to attend picket lines, there is some utility in being able to identify who is supervising or in charge of that picket line; certainly, that would be helpful. But I do not believe that it is necessary to have notification directly to the police in advance of every picket line being set up, and that is simply because, as I have already said, I do not see us needing to attend in the vast majority of cases anyway. However, a mechanism by which we can easily identify who to speak to when we arrive would be of assistance.
Stephen Doughty
Q 245 I have one last question. Would it be your opinion that, in a general sense, industrial relations and the involvement of the police have significantly improved over the last 10, 20 or 30 years, compared with some of the situations that we might have seen in the past, and that we do not want to jeopardise that type of relationship? I think it applies more broadly to the policing of protests, as well, that we have got to a very good situation and that we do not want to put that at risk.
Deputy Chief Constable Hall: Clearly, there is some history here, going back. The police role must be impartial in these industrial disputes, without doubt, and I would like to think that is the position that we have taken in recent years. I agree that that should be maintained. Our role there is to balance the lawful rights of all parties, and I would want to ensure that role continues.
Steve White: I would agree with that. In fact, before this session, I was reflecting—I have been a police officer for 27 years—and trying to remember the last time that we really had something of major significance. We were talking about the dispute involving petrol tanker drivers, and the amount of planning and the number of issues that we had to deal with then. That is probably the last time, but of course that was largely carried off in a very low-key and successful way, although there was a lot of resources and planning behind it, which I think shows how much things have improved.
The Chair
Okay. I am already getting a list of people to ask questions, and we only have half an hour. You do not both need to answer questions unless you really want to, and I ask members of the Committee to try to limit themselves to one supplementary question, unless they are really bursting to ask another. I know that the next questioner will be very brief and to the point.
John Howell (Henley) (Con)
Q 246 Thank you, Sir Edward. May I stay on the same subject? If a dispute gets out of hand, you are required to go and police it. Does the notice period in the Bill not give you advance warning, so you can tell whether policing is likely to be needed? I cannot see what the problem is with the notice period.
Deputy Chief Constable Hall: I think my experience is that in past situations in which we have been required to be involved, or in which we planned to be involved, notification has usually come forward fairly quickly, particularly through the employers, who say, “We believe that we may have issues when this picket line meets.” Those situations are relatively rare, in terms of when picket lines sit. Yes, of course notice helps us to plan, but my experience is that planning does not need to be done in the vast majority of cases, simply because of peaceful picketing. Steve talked about the planned fuel dispute. A lot of planning went into the ability to police picket lines at that time, and as you know, it never quite materialised into a dispute. Those are the sorts of circumstances where advance notice would be very helpful.
John Howell
Q 247 May I follow up with one question? I am still struggling to see what harm the notice period causes.
Deputy Chief Constable Hall: I do not believe it causes any harm, as such. The challenge for policing is whether it is necessary for us, how we then administer it within police forces across the country, and whether we could obtain that information in other ways, either through local authorities or directly with the employer. As I say, we do not see any direct harm in receiving it, but we feel it could be discharged in other ways.
Chris Stephens (Glasgow South West) (SNP)
Q 248 It may appear that I am shouting at you, but I am not; it is so the other members of the Committee can hear me. I apologise.
I have two quick questions. Do you both agree that the proposal to allow agency workers to come in and replace striking workers would result in increased tensions in the workplace and that the police would have to become more involved in those sorts of issues? What more resources would the police need to police some of the aspects in the Bill?
Deputy Chief Constable Hall: I do not think it is for the police service to determine the merits of whether agency workers should come in or not. We know from disputes we have policed in the past that the mention of agency workers tends to increase tension within picket lines. I think there is certainly the possibility that that could be the case if agency workers are brought in to cross picket lines. Clearly, within that we would need to judge each situation on its merits, and potentially we would need to increase police resourcing accordingly.
Steve White: It probably would not surprise you to hear me suggest that our current resource levels in policing would make it extremely—
The Chair
Mr White, you are talking to us.
Steve White: Sorry, let me try that again. You will not be surprised to hear that, from a federation perspective, we are saying that in terms of the resource requirement needed, we would find it very hard to cope with current resource levels should there be large-scale disputes. We are finding it extremely challenging to cope with day-to-day policing with the current resource levels, and the likelihood is that they are going to become squeezed even more. If there is an increased requirement for police involvement around the policing of industrial disputes, that would be more challenging.
Chris Stephens
Q 249 And on agency workers.
Steve White: I agree with Charlie’s view. It is not for us to give a view on that.
The Chair
As you are a main Opposition spokesman, Mr Stephens, if you want to have the same amount of time as Mr Doughty, I am very relaxed about it. Are you happy?
James Cartlidge (South Suffolk) (Con)
Q 250 Thank you for coming in today. I want to focus on the point about identification. Mr Hall, you said that it may be of benefit to be able to identify who to speak to and know who is the organiser. Is that not currently the case, in your experience of dealing with disputes?
Deputy Chief Constable Hall: I think it is generally the case that you can find out that detail, but I would not say it is always the case. Certainly, when we attend, our ability to find who is supervising the picket line and discuss and negotiate with them about the way the picket is conducted enables people to continue to cross the picket line if they wish to do so and enables those on the picket to approach vehicles or individuals trying to cross the picket line. It is always helpful if we can fairly quickly identify who that supervision is. Generally we can do it, but that is not always the case.
James Cartlidge
Q 251 To follow up, I am not trying to pass comment on whether the parts of the Bill that deal with social media are right or wrong, but you use social media for investigations at the moment. People can commit offences using social media. That is currently the case.
Deputy Chief Constable Hall: Yes, it is, and we certainly investigate, all across the country, offences that have allegedly been committed across social media. What we do not do is to censor or vet tweets and social media messages before they are sent out. Once things have gone out, however, we may investigate. Clearly, we could do that in an industrial dispute, as we could in any other area of business.
Ian Mearns (Gateshead) (Lab)
Q 252 On social media, I do not think that this appears in the Bill, but it was certainly referred to in the Department for Business, Innovation and Skills consultation document on the Bill. The consultation document referred to having to give notice of use of social media in support of a picket, and it referred to having to give notice of the content of social media used to support a picket. That concept is interesting, because if you have to give notice of content on Twitter, you potentially introduce the question of secondary and/or wildcat tweeting in support of picketing. Have you got any comments about that?
Steve White: Goodness gracious me. That fills me with dread and fear, I have to say, in terms of having to vet tweets in advance—crikey! I do not think that that is anything that we want to be getting involved with. I am sorry; I just find that quite bizarre.
Deputy Chief Constable Hall: I think I agree. I do not know how we would manage that. I do not know that it is appropriate for us to do that, because we do not do it in any other area. How we would manage that, I really do not know. I think our only role would be when things have been sent out. If people are potentially committing a criminal offence by sending those out, there is a role, potentially, for us to investigate those, as there is with any other use of social media.
Ian Mearns
Q 253 And there is law covering that sort of content anyway, is there not?
Deputy Chief Constable Hall: Yes.
Nusrat Ghani (Wealden) (Con)
Q 254 You have both mentioned limited resources. I just want to ask you whether you think it is right that your limited resources are used to get involved in large-scale strikes in the country. Looking at the tube strikes, for example, do you think that it is right that police resources are used to manage the strikes when only a minority of people have asked for them in the first place?
Deputy Chief Constable Hall: As Steve has already said, in policing we have got many priorities at the moment, and industrial disputes, if I am honest, are probably not at the top of the list of what we need to deploy resources against. What I would say is that we have a responsibility to keep the peace and uphold the law, and that can see us deployed into all sorts of different situations. Clearly, industrial dispute is one of those.
If there are industrial disputes where that role is necessary, then I would say that we will continue to need to deploy resources, but it does take resource away from other areas that I am sure all the police and crime commissioners around the country would consider to be our priorities, such as dealing with vulnerable people and reducing crime. This is not a natural area that falls into those priorities, but if we need to deploy resources to keep the peace, of course we will continue to do so.
Nusrat Ghani
Q 255 So you are being made to deploy resources from other incidents to manage strike action, when only a minority of people have asked for those strikes?
Deputy Chief Constable Hall: It is inevitably going to do that. When we have a limited and reducing resource base, large-scale deployment of police to industrial disputes is going to pull officers from other duties and responsibilities.
Steve White: The only comment I would make is that a distinction needs to be made between managing an industrial dispute—in terms of who is in charge, informing the police and managing it—and responding to an incident of disorder. We would respond to an incident of disorder whether it is in relation to an industrial dispute or a pub fight. Of course, we have a duty to respond to that, and we need to ensure that we have got the resources in place to do that. As Charlie has already said, the desire would be for these industrial disputes to be self-policing. If they are not, we are going to need resources and we do not have them.
Nusrat Ghani
Q 256 So you would have to deploy resources from elsewhere. You mentioned industrial disputes being self-policing, and you also mentioned, Chief Constable, that it would be easier if you were able to identify individuals who might be in charge if you came across a scenario. Wearing an armband would be one easy way to identify people, would it not?
Deputy Chief Constable Hall: Quite possibly.
Nusrat Ghani
Q 257 And you do not think that is detrimental to their human rights—having to wear an arm band?
Deputy Chief Constable Hall: I think that is probably for others to decide. I think what I have said is that when we attend being able to find out fairly quickly who is in charge and responsible for that picket is helpful to us. So there are many different ways I think that could be done.
Nusrat Ghani
Q 258 It saves money and saves time, does not it?
Deputy Chief Constable Hall: Well, we can quickly get in, negotiate and try to resolve whatever reason we have been called there for.
Steve White: We must not forget the use of good policing skills in this. Most of the time it is not rocket science. You can quickly establish who is in charge, whether they are wearing an arm band or not; but of course this is about the management of it, rather than responding to an incident. I suspect if there is major disorder breaking out you do not necessarily need to go and find who is in charge. You need to deal with the disorder. That is the only comment I would make.
Nusrat Ghani
Q 259 You also mentioned that it is very rare to get into a difficult situation. Most of the time these situations are self-policed and well managed; but have you come across scenarios where people wanting to cross the picket line have felt intimidated? Have you had to police that situation at all?
Deputy Chief Constable Hall: I think policing across the country will certainly have come across that. In my experience, and what I have had fed to me, sometimes at the mere presence of a picket line individuals can feel intimidated; but that is not necessarily, given that picket lines have protection within the law, something that the police are going to intervene about. I think there is a whole spectrum of intimidation, and some people who may wish to go into work will simply feel intimidated because of a presence there, and in my view that is not something that policing would then intervene with. We start to intervene where disorder is looking likely, or there are actual criminal offences that we have on the statute book that we need to deal with.
Steve White: Can I just come back on that? In terms of adding balance you can have the perception that a picket line could be threatening, and I am thinking about the footage from large industrial disputes of the past—the miners’ strike, for example. The last picket that I saw was local to me, in the south-west of England. It was in relation to a rail dispute, I think it was. I have to say that the atmosphere on the picket line was one of very light-hearted jolliness—people tooting their horns and shouting and waving, and so on and so forth. I only add that from a question of balance. Clearly we would not be involved in policing that picket line; but of course, as Charlie has said, if things overstep the mark and start to impress on the peace of it, then of course—
Nusrat Ghani
Then you have to move resources across.
Steve White: Yes, of course; but there is a balance to be had. As I say, everyone seemed to be enjoying themselves at that picket line.
The Chair
When I was practising as a criminal barrister we were not allowed to ask leading questions. There is nothing out of order about leading questions, but our witnesses are so skilled that one probably does not need to lead them, and I sure Mr Doughty, who has the next question, will not.
Stephen Doughty
Q 260 There has been some quite unhelpful rhetoric from Ministers about the Bill and industrial action in general. Although industrial action has been at significantly low levels for a generation, the Minister for the Cabinet Office has talked about setting up hit squads, and standing ready to use the Cobra system to deal with industrial action. What are your thoughts about those comments? Do you think it is appropriate that we are talking about using the Cobra system, which is a key national resilience mechanism, to deal with what are extremely low levels of industrial action?
Steve White: My reaction to that—I am not experienced at Cobra; I know that Charlie is—is that we have got to remember that policing in this country is wholly independent of the state. I think that is the important element to recall around that. There is not political control of the police service in this country, and I think it is important that that should continue. Policies and procedures that the Government want to put in place are a matter for the Government, but I will just make that point.
Deputy Chief Constable Hall: I would agree with that—that chief constables are independent in terms of how they deploy their resources, and we must remain impartial to the merits of whatever the dispute is around. I think I can perhaps understand why Cobra may, for some disputes, feel the need to meet to sustain services, but the police role within that will always remain impartial. If there is disorder to be dealt with, or there are criminal offences to be dealt with, we will do it, but our role will be as much to facilitate the lawful picketing as it will to facilitate the lawful carrying on of business activities. Our role is right in the middle of that.
Stephen Doughty
Q 261 Specifically on Cobra, in your view would it be a very small number of instances where it would ever be appropriate for that system to be brought into play?
Deputy Chief Constable Hall: That is ultimately for Government to determine, but I see that there are often local disputes where Cobra would never need to get involved and manage that. The Government will make decisions as to when they need to activate that machinery.
Rishi Sunak (Richmond (Yorks)) (Con)
Q 262 Thank you both for being here. I have a question for the deputy chief constable. I think you mentioned that your primary responsibilities are to keep the peace and uphold the law. Obviously there have been situations where that has not been the case on picket lines, and we heard evidence on Tuesday about that and talk of intimidation. I was looking around at how you deal with other organised protests, such as marches, and it says clearly on the Met police website:
“Organisers should try to give as much notice as possible”,
and provide the names and addresses of organisers. Given that, would it be a help or a hindrance for you to have the notice period in the Bill of two weeks and the identity of someone organising a protest? It seems pretty clear that it would be a help, rather than a hindrance, but I wanted to confirm which of those you think it would be.
Deputy Chief Constable Hall: Well, I think there are degrees of protest. If you look at protest across the country as a whole, there are some big, national-level protests, but almost on a day-to-day basis many smaller protests take place, too. We are certainly not notified of all of them, nor do I think it practical for police to be notified of them. Many protests are self-policed and are not ones that we would particularly need to get involved with.
Certainly for the bigger scale protests—the ones that are likely to involve some element of policing—some advance notice to plan around that is necessary. Very often, our intelligence structures provide that information to us anyway to enable plans to be put in place. Some of that comes through organisers notifying us, and some of it comes from information and intelligence that we receive into policing.
Rishi Sunak
Q 263 Am I right in thinking that it is helpful, then? The Metropolitan police ask for as much information as possible.
Deputy Chief Constable Hall: It is certainly helpful when plans need to be put in place, but I would say that not all protests are of that scale and not all protests on a day-to-day basis receive attention.
Rishi Sunak
Q 264 I have a quick follow-up for Steve. When you were describing the picket lines that you have been involved in, you were saying that people were thoroughly enjoying themselves and having a jolly. Part of why we are all here, and the Bill is here, is to tackle the issue of strikes being held on low turnouts and out-of-date ballots that then inconvenience millions of people across the country. We have been hearing from union representatives that, for the most part, they understand that strikes are a last resort and are taken very seriously. Do you also agree with that? The description that you gave just a minute ago about people having a bit of a jolly and thoroughly enjoying themselves, while inconveniencing millions of people, seemed a bit out of kilter with what we have been hearing from others.
Steve White: The context in which I answered that question was in relation to whether picket lines were threatening. I was just giving the balance that in my experience that picket line was probably not one of the threatening ones. In terms of whether a strike should be called and what the level of turnout should be, that is quite simply not a matter for the police service. That is a matter for others; our primary concern is that the peace is kept and that things happen within the law.
I just want to pick up on your previous point to Charlie in relation to notification. It would be great if the police service had more than two weeks’ notice for every single resource requirement that we ever have, but we do not. We have to have resources in place to deal with the unexpected. That includes whether or not we have been notified of something. As Charlie said, that does not necessarily mean that we will have to be used or deployed.
The Chair
Okay. We have two minutes and two more questions. Jo Stevens and Seema Kennedy, just a brisk question from each of you, please.
Jo Stevens (Cardiff Central) (Lab)
Q 265 I have a question for both witnesses, if I may. You have both talked about the pressures on operational resources at the moment. Given the additional workload for the police that will come in if the Bill becomes law, would you rather have that, or not?
Deputy Chief Constable Hall: Well, I think what we would rather be able to do is concentrate on the priorities set down to us by chief constables and police and crime commissioners. There is potentially some additional work for recording the notifications that come through, but I do not think I would want to over-emphasise how significant that is likely to be. That will vary, depending on where you are in the country and those mechanisms. Where we would be concerned is if there is an expectation that at every picket line there is a higher level of police presence. If that is the case, that will impact on other priorities.
Seema Kennedy (South Ribble) (Con)
Q 266 On Tuesday, we heard from one of the opposition witnesses, Dave Smith, who made very serious claims about police collusion in blacklisting. He said, among other things, that the police are going to keep a list of picket supervisors and pass it on to big businesses. How would you respond to those very serious allegations?
Deputy Chief Constable Hall: I would say that I cannot see us doing that.
Seema Kennedy
Q 267 So you would say that what he said was untrue.
Deputy Chief Constable Hall: I cannot see the police service doing that. That is not something I would expect to happen.
Steve White: I do not think we would, and certainly we should not.
The Chair
Good. Thank you very much, gentlemen, for your evidence, which is much appreciated. Thank you for taking the time to talk to us. We are very grateful.
Examination of Witnesses
David Palmer-Jones and Commissioner Ron Dobson gave evidence.
The Chair
Good afternoon. We are now joined by David Palmer-Jones, who is chief executive officer of SITA UK, and Commissioner Ron Dobson of the London fire brigade. You are both very welcome.
Stephen Doughty
Q 268 I have a question for each of you. First, Commissioner, could you outline your relationships with the Fire Brigades Union, how you feel they are at the moment and whether you think the Bill will help or hinder them?
Commissioner Dobson: Relationships with the FBU are, in my opinion, positive. We have some issues we need to deal with, both locally and nationally, in relation to Government challenges to the firefighters’ pension scheme, which is still unresolved. Generally, at a local level, our relationships are reasonable. The London fire brigade has had experience of industrial action—back in 2010 in relation to a local dispute, and in the past couple of years in relation to the national pensions dispute. I have to say that the conduct during those two disputes was very different. There is a stark comparison between the two. We are always trying to improve our relationship with the Fire Brigades Union. There are some difficulties at the moment, but we are working hard to resolve them.
Stephen Doughty
Q 269 David, I understand that there has been a series of disputes involving your company. Can you tell us a bit about one of the disputes that is going on in relation to Teesside and Merseyside at the moment? I understand that trade unions have recently met with the company and requested a full forensic audit of your workers’ terms and conditions, but apparently you have refused it on cost grounds. The trade unions involved have offered to pay for the audit, but it has been refused. Could you tell us a bit about the dispute and why that is the situation at the moment?
David Palmer-Jones: Okay, I can do that. I will be as quick as possible. We are in the process of building an energy-from-waste plant up in Teesside. We have been investing in Teesside for the past 15 years: we have probably spent £700 million and employed 500 people in that area, and we are continuing to do that. I am in the process of doing a piece of work—a PFI-type contract—for Merseyside Waste Disposal Authority, which is progressing very well. We are almost three years into the build now, so the build is almost complete. About a year ago, we were targeted by some local activists who are running a campaign around “pay the rate”, which is some form of national protest that is looking at pay on very specific types of national agreements. At the moment, we are a minority shareholder—a 40% shareholder—in that particular element, and I will take over the operation of that facility early next year.
Stephen Doughty
Q 270 I asked a very specific question, though. I understand that there has been a request for a forensic audit of your workers’ terms and conditions. Why have you refused the willingness to pay for it?
David Palmer-Jones: We have not refused. We have already done a forensic audit. As you can imagine, it is quite a complex audit to do. We have more than 60 different contractors involved in the project. We have a head contractor and 60 others, all of which bring specialist services to build the £220 million project. On behalf of Merseyside, we did that analysis. I met with the national union representatives recently, and I had the opportunity to show the officers and the elected members of Merseyside—our customer—that information, which satisfied them. I made a genuine offer. It was controlled by ACAS, and we asked for ACAS to come in. I was very happy to share and pay for a forensic audit of the wages on that site through ACAS. That was refused by the unions. Therefore, I am left in a rather difficult position with an ongoing dispute. Our company has now experienced 29 protests, at both the Wilton site and—
The Chair
May I interrupt? This is not a Select Committee, Mr Doughty; it is a Bill Committee, so your questions have to go laser-like to the Bill.
Stephen Doughty
Q 271 The reason I wanted to ask the question was to find out why you think you have been asked here to give evidence on the Bill. Is it so that your poor industrial relations with a whole series of unions can then be used as an example to be reflected in full-scale national policy making? Is that why you think you have been invited here today?
David Palmer-Jones: I hope I have been asked here today to look at some of the grey areas—not the black and white areas about intimidation or numbers of pickets and so on—and perhaps a changing tactic on protests and the disruption they cause my company in continuing to invest in Teesside. I think that is why I have been invited; I hope so.
Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)
Q 272 The project at Wilton, of course, uses CNIM Clugston as the engineering, procurement and construction contractor. Are you aware of allegations that CNIM Clugston is paying certain members of staff—contractors who they employ and who are non-British workers—€6 an hour?
David Palmer-Jones: That is a complete fallacy. It is untrue. I have done the audit. I have seen the information myself and presented it to Merseyside council and the elected members. They are satisfied, as my customer. I have no obligation to show the unions. I offered, very genuinely, to involve ACAS, so that they could see it. They refused. They want to do their own audit.
Tom Blenkinsop
You are under no obligation, of course, to show a forensic audit to local MPs, but local MPs, of which I am one, have not been shown that information.
The Minister for Skills (Nick Boles)
Sir Edward, may I inquire about the relevance of this to the legislation that the Committee is charged with scrutinising?
The Chair
I have made the point that I have to trust Members, in a sense. They are in charge of their own questioning, and I am not going to draw people up, but they have to remember that there must be a focus on the Bill all the time. Our witnesses must be aware that we are talking about the Bill.
Nick Boles
I have not yet heard any question to this witness about any measure in the Bill.
The Chair
Mr Blenkinsop has heard you, Minister, and I am sure both he and the witnesses will focus on the Bill.
Tom Blenkinsop
Q 273 For other contracts in Wilton—there are other power stations being built that I am aware of—are blue book terms being adhered to on that site, and will you show local MPs that evidence?
David Palmer-Jones: We have said that we will share that evidence with ACAS. We continue to pay national rates or above national rates, and we are happy to do a forensic audit for ACAS.
Tom Blenkinsop
Q 274 And will you show local MPs that forensic audit?
David Palmer-Jones: In that instance, I do not feel obliged to do so. I will show ACAS.
Seema Kennedy
Q 275 Mr Palmer-Jones, in relation to the code of practice on picketing, could you elaborate on how social media is used to intimidate workers at Wilton?
David Palmer-Jones: There is a large social media presence in Wilton, orchestrated by the head of this activity—this protest. They use extensively Facebook in order to call to arms their local protesters, and they use it also to spread particularly damaging comments about not only my staff but other members associated with this particular construction.
Seema Kennedy
Q 276 Could you describe some of the effects that has had on the workers?
David Palmer-Jones: Clearly, people feel very intimidated. They have now moved from Wilton to our other sites within the north-east, where we have a number of energy-from-waste plants. They attended yesterday another protest—the 29th protest—so they seem to be changing tactics. They disrupt local people. They stop the traffic. They cause an undue amount of disruption, and it is not nice for people to have to go through picket lines, with people only yesterday saying, “We know where you live. We’re going to visit you.” It is not at all something I can condone. We have to protect my staff. I have come here to protect my staff. It is really important that you understand the normal situation. I am not an employment lawyer at all, as you can hear; I just see the effects on our business and on my feelings about whether I continue to invest in Teesside in the future.
Chris Stephens
Q 277 I have some questions for Commissioner Dobson. Could you confirm whether you believe that the evidence collected in the Department for Business, Innovation and Skills consultation on intimidation in the fire and rescue services is pretty thin? Could you also confirm that according to the Carr review, the decline in allegations of intimidation between the two disputes you referred to was down to better contingency planning? Given that you have intimated that industrial relations are more positive, would that not demonstrate that the Bill is unnecessary?
Commissioner Dobson: In relation to the evidence submitted to the Carr review, the majority of that is in relation to the London fire brigade during the 2010 local dispute. The evidence there is not thin; it is quite substantial in terms of the intimidation and bullying that some non-striking workers and people who were providing our contingency plan experienced. I would not say the evidence was thin. I do not have any particular basis on which to compare it with other industries, so the evidence is as it is.
My view is that the relationships with the Fire Brigades Union are difficult at times, but they are being managed well and are improving. We are working very hard to improve relationships, and I do not see anything in the Bill that would particularly make relationships between management in the London fire brigade and the Fire Brigades Union worse. There are potentially some safeguards within the Bill that would help both the London fire brigade and the Fire Brigades Union in respect of our relationships.
Chris Stephens
Q 278 Okay. The Carr review said that allegations of intimidation decreased between those two disputes because of contingency planning. Do you agree with that?
Commissioner Dobson: There are a number of reasons why bullying and intimidation decreased in the national dispute. There are differences between a local dispute and a national dispute, and the feelings they generate among the people going on strike and the unions. We learnt some lessons in terms of the management of the strikes during the 2010 dispute. It is true to say that, managerially, we have put some things in place to try to prevent intimidation of non-striking workers and the blockade of workplaces. We learnt some things and we think we did well.
During the 2010 dispute, because of some of the behaviours in relation to picket lines and striking workers elsewhere in London following around our contingency crews and trying to intimidate them at the incident ground, we sought to go to court to have the code of conduct on picketing enforced. We did not actually need to get the court order in the end, because we managed to reach agreement with the Fire Brigades Union prior to getting to court. Since that agreement was made and the code of conduct was adhered to, we have seen much lower levels of intimidation and bullying. The conduct of the picket lines and the strike generally in the past two years has been in line with how we would expect people to behave.
Chris Stephens
Q 279 I have one last question. My understanding is that you gave evidence to the Carr review.
Commissioner Dobson: No, I did not.
Chris Stephens
Q 280 Okay. Did you have any private meetings with Mr Carr?
Commissioner Dobson: I did. I had a private meeting with Mr Carr.
Chris Stephens
Q 281 Was that in a professional or personal capacity?
Commissioner Dobson: It was professional, because I was commissioner for London, but it was in my personal opinion, rather than that of my fire authority.
Victoria Prentis (Banbury) (Con)
Q 282 Mr Palmer-Jones, you were just touching on intimidation and the picket line you saw yesterday. Could you tell us a bit more?
David Palmer-Jones: I was not actually there yesterday, but we had reports back from my staff. Again, there is a movement from the Wilton construction site to our own sites and threats of other, secondary protesting. That was why I was very keen to come today, to explain the grey area that could expand.
Victoria Prentis
Q 283 It would be very helpful to hear more about that.
David Palmer-Jones: This is something that is very much condoned by the unions. When I meet with Merseyside and those unions, I am meeting the senior national levels of the union, which in some way tacitly approve of the tactics being deployed up in Teesside at the moment. We have a situation where council employees who are delivering household waste vehicles to the site feel quite intimidated to go across a picket line and a protest that is very much dressed in the union colours and waving union flags. They do not want to cross what is not an industrial action. This is very important to understand: there is no industrial action on any of our sites, yet I am still facing the difficulty of a sponsored, wider protest that is of a more national scale.
Stephen Doughty
Q 284 I just have a specific question, given what the commissioner has been saying. Can you confirm whether during the 2010 dispute any FBU members were actually arrested or prosecuted for their behaviour in picketing; and, secondly, can you confirm whether any agency staff brought in were arrested or prosecuted for their behaviour?
Commissioner Dobson: No, nobody was actually prosecuted.
Stephen Doughty
Q 285 Was anybody arrested?
Commissioner Dobson: I am trying to think; I cannot recall anybody being arrested, but they may have been—but certainly nobody was prosecuted, and the police did investigate a number of things that occurred on some of the picket lines and elsewhere.
Stephen Doughty
Q 286 But no FBU members, to your knowledge, were arrested or prosecuted.
Commissioner Dobson: No.
Stephen Doughty
Q 287 Given that you are not aware of the wider circumstances, could you perhaps write to us and tell us what happened during that dispute, given that it has been referred to a number of times, with agency workers who were brought in? I think that is directly relevant to the Bill, because there are obviously proposals that the Government are putting forward on the use of agency workers. I think it is important to understand the sort of tensions that are created. Do you think there is potential for tensions being created more widely in industrial disputes by agency workers being brought in, particularly in professions such as yours where there are specific sets of health and safety concerns and specialities?
Commissioner Dobson: I think there are tensions when agency workers are used. Our emergency fire crew contract, which provides our contingency arrangements, is provided by an external company. We contract it out in order to meet the requirements of the current employment legislation. That obviously does increase tensions, because striking workers see somebody else doing their job; I think it does increase tension.
The difficulty is, in an industry such as mine where we are providing a critical emergency service, we do need arrangements in place to cover public safety if the fire brigade is on strike. Therefore, we did not really have much choice. Other fire brigades outside London use other arrangements; but they have the opportunity to use people who maybe were retained fire fighters. We do not have that opportunity in London and we needed to make sure we had a robust contingency plan in place. That does create tensions, inevitably, but I do not think we have any option on that at the moment.
Edward Argar (Charnwood) (Con)
Q 288 You have both referenced how keen you are to ensure good industrial relations in the work you do and the duty you have to your staff, to protect and look after them. We have heard a number of references from both sides, and from both of you, about intimidation. Can you give us a flavour of specific examples that have stuck in your mind of the form that intimidation has taken—what was said, what was done and how that played out?
Commissioner Dobson: In terms of physical intimidation, during the 2010 dispute—and I have to be clear that this did not take place in the recent disputes—we saw the emergency fire crew operatives being refused access to fire stations and being intimidated: followed to incidents when they were actually attending emergency calls. They were followed there by striking workers and intimidated at the incident ground.
We have seen photographs being taken and posted on social media of people who were working during the strike, with comments such as, “We know who you are; we know where you live.” We have seen intimidation of some of the emergency fire crew by taking photographs of them and trying to find out what their names were, and by comments such as, “Don’t come back to London because we know who you are.” So there is a range of intimidation using social media.
All those instances where these things have happened have been reported to the police, but I refer back to the previous people giving evidence about how difficult it is to investigate and bring to a conclusion any offences over social media. So while it was investigated, unfortunately, there was not any result to the investigations; but they certainly took place and the evidence exists and actually has been shown to the Committee before.
David Palmer-Jones: I think from my side it is really the fact that it can occur away from the site itself. That is the bit that concerns us the most. We have had instances where cars have been damaged, threats of violence to our supervisor, and threats to other members of staff, who are not members of the union, who continue to work. That causes a lot of disruption and disharmony in the workforce; and we do not have many strikes, I can assure you—perhaps one in the last 10 years. When it does happen, there needs to be some form of control, very much specifically around secondary action outside the local area where the picket would happen. That is the most worrying for me.
Edward Argar
Q 289 I have a quick follow-up for the commissioner, and answer this as you wish. Did you have any reason to believe, or any evidence, notwithstanding that there were no arrests, that those who were either officials in or members of the FBU were those taking the photographs and carrying out that action?
Commissioner Dobson: I have no evidence to suggest that, I am afraid.
Julie Elliott (Sunderland Central) (Lab)
Q 290 I have a couple of very quick follow-ups to what you were saying, Mr Palmer-Jones. On the incidents you have been talking about in relation to Teesside, can you confirm that that is not industrial action?
David Palmer-Jones: It is not industrial action.
Julie Elliott
Q 291 Therefore, can you confirm that the Bill does not apply to those instances, because they are not pickets?
David Palmer-Jones: The worry, looking at paragraph 37 —again, I am not a lawyer—is that it is the unions that are really supporting the action. Therefore, they are—
Julie Elliott
Q 292 They are not pickets if it is not industrial action.
David Palmer-Jones: They are not pickets; they are protesters.
Julie Elliott
Q 293 Thank you. Can I clarify one other thing you said? You said that officials of trade unions were tacitly approving the tactics deployed. Can you tell me which trade unions were doing that? We have the general secretaries of the big trade unions involved in your company here later today giving evidence, and we would like to put that to them.
David Palmer-Jones: The ones that I met, together with Merseyside—the customer—were Unite, GMB and UCATT.
James Cartlidge
Q 294 Commissioner Dobson, in your earlier remarks you said that nothing in the Bill will worsen relationships in your view, but there are safeguards in it that will be of benefit. Do you welcome the threshold for action, which is one of the most important parts of the Bill?
Commissioner Dobson: I do welcome it, but it is important for the Committee to recognise that I cannot think of an industrial dispute with the Fire Brigades Union in recent years where that threshold would not have been met, so I do not think it would have had any practical impact on previous disputes.
James Cartlidge
Q 295 It is just adding extra safeguards.
Commissioner Dobson: Yes.
James Cartlidge
Q 296 Just on what you said to my colleague Mr Argar about examples of intimidation, you said that in 2010 access was stopped to a fire station in an emergency.
Commissioner Dobson: Access was stopped for our emergency fire crews—our contingency service. They were stopped from getting on to our fire station. In 2010, our plan was to deploy emergency fire crews from fire stations, but we had such difficulty in getting the emergency fire crews on to the fire stations because of the picket lines and striking workers who were barricading themselves on to fire stations. In one instance, they took a dog on to the fire station to stop emergency crews getting in.
James Cartlidge
Q 297 This was while there was a fire?
Commissioner Dobson: No, this was during the strike. During the fires, we had some instances where the striking workers followed emergency crews to incidents, damaged fire engines en route and tried to intimidate the emergency workers, while they were trying to deal with an incident. In some cases, they were trying to deal with actual fires and they were being obstructed by striking workers.
Jo Stevens
Q 298 I have a question for Mr Dobson. You have talked a lot about examples of intimidation during the 2010 dispute, and you also said that you had a private meeting with Mr Carr. You will be aware that the impact assessment for this Bill drew on the Carr review to justify what is in the Bill. I am sure you are also aware that Mr Carr was unable to make any evidence-based proposals or recommendations for change because of the lack of a significant body of evidence to support any recommendations for change. In your meeting with him, did you give him the examples of intimidation that you have described?
Commissioner Dobson: I did, yes.
Jo Stevens
Q 299 And you did that in a personal capacity, not a professional one.
Commissioner Dobson: Yes.
Jo Stevens
Q 300 Was it because a majority in the Greater London Authority had decided that you should not give evidence to Mr Carr?
Commissioner Dobson: There was no decision about whether or not I should give evidence, because it was never presented to elected members in that way.
Jo Stevens
Q 301 At its meeting on 29 January this year, the GLA indicated that your evidence appeared in the Carr report in contravention of the wishes of a majority of assembly members. Do you deny that?
Commissioner Dobson: My giving evidence to the Carr review was never presented to the London Assembly for their view on it. The fact that I had spoken to Mr Carr was discussed when the Carr review was published, but it was not discussed beforehand.
Jo Stevens
Q 302 Are you aware that the Regulatory Policy Committee has described the impact assessment for the Bill as “not fit for purpose”?
Commissioner Dobson: Yes.
Jo Stevens
Q 303 Following on—a very brief question, if I may—in relation to the same dispute, can you tell the Committee what you believe led to the dispute happening in the first instance and what action you took to try to prevent it from occurring? I am aware that you attempted to de-escalate the dispute by docking the pay of 368 staff; that was later found unlawful by an employment tribunal. Can you tell us a little about that?
Commissioner Dobson: There was a dispute over the start and finish times of shifts. We sought to change the start and finish times of shifts in order to increase productivity. We negotiated fully with the Fire Brigades Union on that but were unable to reach an agreement, which led to a strike ballot and that led to strikes. During the industrial action that took place, via either action short of a strike or a strike, some members of staff took actions that were against their contracts and were not covered by the ballot, so some workers’ pay was deducted. The employment tribunal has found only in the cases of three staff at the moment; the remainder of cases are still subject to discussion with the Fire Brigades Union. Let us be absolutely clear—the Committee needs to be aware of this—that the employment tribunal has listened to the cases of only three workers, not the others.
Jo Stevens
Q 304 But it found against you: what you did was unlawful.
Commissioner Dobson: In those three instances, yes.
Nick Boles
Q 305 The hon. Member for Cardiff Central seemed to suggest that it was appropriate for the Greater London Assembly to have gagged you and prevented you from giving evidence on any matter that falls within your professional responsibility. You said very clearly that the assembly did not and that there was never any consideration of that. Nevertheless, had they tried to do so, do you think that that would have been appropriate?
Commissioner Dobson: No, I do not. My contract is with the London Fire and Emergency Planning Authority, so it would be appropriate for it to take a view on whether or not I, as one of its employees, should give evidence, but not necessarily the London assembly.
Nick Boles
Q 306 And even if that authority had taken that view, would you, nevertheless, have felt it was right to prevent you from talking to an independent inquiry?
Commissioner Dobson: My personal view would be that it would be wrong to prevent me from talking to an independent inquiry, but, as a matter of fact, no decision of that nature was ever taken.
The Chair
John Howell is champing at the bit, but he is such a gentleman that I know he will want Nusrat Ghani to go first.
Nusrat Ghani
Q 307 Thank you, Chair.
Commissioner Dobson, I want to ask about something you mentioned to Mr Cartlidge earlier. Is it correct that in the 2010 dispute the non-striking workers found it difficult to get into the fire station?
Commissioner Dobson: Yes.
Nusrat Ghani
Q 308 You also mentioned that fire engines were approached, deterred or attacked when leaving the station.
Commissioner Dobson: Yes.
Nusrat Ghani
Q 309 Were any firefighters’ lives at risk at that time, when they were trying to carry out their duty?
Commissioner Dobson: No, I do not think that their lives were at risk. It was the emergency fire crew workers—the contingency force—who were followed and intimidated. I do not think that their lives were put at risk, but they certainly felt intimidated.
Nusrat Ghani
Q 310 They could have been hurt though.
Commissioner Dobson: Yes.
Nusrat Ghani
Q 311 And the victims of fire—could their lives have been put at risk if fire engines were unable to get out to them in a decent time?
Commissioner Dobson: That is a possibility, yes.
Nusrat Ghani
Q 312 So it was dangerous for both the firefighters and the victims of fire who were asking for help.
Commissioner Dobson: Yes, I believe it was.
John Howell
Q 313 Mr Palmer-Jones, earlier you threw away a line about the intimidation you had been facing being likely to affect your ability to invest. Would you like to explain that?
David Palmer-Jones: As I said, together with others, I have invested probably around £700 million and I employ more than 500 people in that area. I have the ability to invest more, but when faced with the sort of intimidation and protest that we have been suffering, I have to think twice about where I spend my money. I am currently in the process of employing people from SSI: I have taken on 20 people and am looking for others to help me to run that plant, and we are taking on apprentices. But you can see why, when faced with an uncontrolled set of continual protests—the 29th—we would think twice about whether we bother to invest in that area. It is an area that we have supported for the past 15 or 20 years.
John Howell
Q 314 So you would welcome putting the existing code of conduct into a statutory form?
David Palmer-Jones: We would have to. Again, it is important that you widen and capture this particular grey area. You really need to look at the fact that the unions should be held responsible if they are actively supporting these types of protest.
Chris Stephens
Q 315 Just a quick question to Commissioner Dobson. In an answer to Mr Cartlidge, you indicated that you agree with the thresholds in the Bill. Is that your private opinion or were you speaking for you organisation?
Commissioner Dobson: That is my opinion.
The Chair
Thank you very much for your evidence, gentlemen.
Examination of Witness
Byron Taylor gave evidence.
The Chair
Our last witness this morning is Byron Taylor of the national office of the Trade Union and Labour Party Liaison Organisation.
Stephen Doughty
Q 316 For the avoidance of doubt, I have already declared an interest, but obviously, I am a member of the Labour party and of the GMB, which is a member of TULO. Byron, could you tell us why you believe the provisions in the Bill break the established conventions on arrangements for political party funding?
Byron Taylor: The Bill is a fairly partisan attack on Her Majesty’s Opposition. It does significant damage to the funding of the Labour party, and I think that is in breach of existing parliamentary convention.
There is a long history here. Back in 1948, Winston Churchill said:
“It has become a well-established custom that matters affecting the interests of rival parties should not be settled by the imposition of the will of one side over the other, but by an agreement reached either between the leaders of the main parties or by conferences under the impartial guidance of Mr. Speaker.”—[Official Report, 16 February 1948; Vol. 447, c. 859.]
That was reinforced by Margaret Thatcher in a Cabinet meeting on 9 February 1984, when she said:
“legislation on this subject, which would affect the funding of the Labour party, would create great unease and should not be entered into lightly.”
There is a fairly well-established history of parliamentary convention that says parties should not interfere in matters affecting the Opposition. Even as recently as 1998, the Conservative party’s submission to the Committee on Standards in Public Life stated:
“The Conservative Party does not believe that it is illegitimate for the trade union movement to provide support for political parties.”
The Bill, in its current format, is designed to do exactly that and to stop the trade union movement being involved in political parties. That is a really important concern, because there is not only an established parliamentary convention.
There are very solid grounds about the freedom of association: article 11 of the Human Rights Act 1998, the European charter of fundamental rights and, dating right back to 1948, the universal declaration of human rights, to which this country is a signatory, which says:
“Everyone has the right to freedom of peaceful assembly and to freedom of association with others, including the right to form and to join trade unions for the protection of his interests. No restrictions shall be placed on the exercise of these rights other than such as are prescribed by law and are necessary in a democratic society”.
Stephen Doughty
Q 317 May I ask a specific question? There is an important point here about the distinction being made between the rules governing company donations and corporate donations to political parties and trade union donations to political parties. Could you say a little bit about the difference between the conditions that will be brought about by this Bill and what applies to, for example, companies making political donations—for example, the ability of shareholders to opt out of those decisions?
Byron Taylor: Indeed. There is no right for shareholders to opt out of political donations. A company is required to make a political resolution once every four years. A private company can do it by simple resolution. A public company does it at the annual general meeting, but the reality is that a single political resolution is made every four years.
If you contrast that with the requirements upon a trade union, there are significant differences. The trade union membership here in the UK already enjoys fairly substantial protection. We call it the triple lock. In the first instance, a trade union member can opt in or opt out of the political fund at any time, and that has been the case here in the UK since the 1940s. In addition, they can participate in the representative democracy of their trade union if they are unhappy with how a trade union is operating their political activity. They can participate in the structures of the union and seek to change how that activity is conducted. Finally, there are political fund review ballots, which operate once every 10 years. That is a simple one member, one vote ballot on the membership. The membership, should it so wish, can choose to disestablish any existing political funds, so there are several safeguards for trade union members in the operation of political funds that are not comparable with those upon companies.
This is a critical point. If you look at some of the donations that come in from companies—the one I draw reference to is Bearwood Corporate Services, which made 177 donations to the Conservative party, totalling £5.3 million. If you look at the ownership structure, it goes back to two faceless companies in the British Virgin Islands. We have no idea who is behind those donations.
Stephen Doughty
Q 318 Can you give us some practical examples of how trade unions are transparent about their funding—the amounts that are given and so on—at the moment, and why the provisions in the Bill simply are not required?
Byron Taylor: Trade unions are already required to publish any donations to a political party under the auspices of the Political Parties, Elections and Referendums Act 2000. In addition, they are already required to provide significant information to the certification officer about the number of members in the fund and the amounts paid into the fund and so on. There are already significant reporting requirements on the trade union movement about how political funds are expended. That is an important and clear point. What is proposed in the Bill represents a serious change to the way in which trade unions operate without any basis in evidence to do so.
Stephen Doughty
Q 319 The Bill’s provisions would have to be adhered to within three months of Royal Assent and its commencement. Do you think that is a fair amount of time for any organisation to comply with such significant changes to law?
Byron Taylor: No, I really do not. Three months is an extremely short timescale. Let us bear in mind that trade unions are, primarily, industrial organisations; politics is very much a secondary function for them. If the Bill is passed unamended, we will be asking 4.9 million people to opt back into the political fund in a three-month period. To set that against a couple of other examples, the recent changes relating to plastic bags supplied by retailers were enacted in Ireland in 2002, in Wales in 2011 and in Scotland in 2012. The coalition Government initiated the change in the UK in 2013 when they conducted the regulatory impact assessment and the Deputy Prime Minister announced the policy in October 2013. Companies have had a significant time to be aware that the changes are likely to happen, and as of 2013 they had two years to prepare for that.
Another example is self-assessment; everyone who completes a self-assessment is required to submit their returns by the end of January each year. They have a clear 12-month notice period that they must effect that change, and a significant Government-sponsored media campaign is run to inform people that they need to get their returns in by 31 January. If they fail to do so, a fine of £100 is imposed. Despite all those safeguards, this year alone, 890,000 people failed to fill in their self-assessments. We are asking 4.9 million trade unionists to opt into the political fund in a three-month period dated from Royal Assent, and I think that is unacceptable. There is also the issue of retrospection. Those people joined a collective organisation and opted, as part of their decision to join a trade union, to become part of the political fund. I see no clear public interest test that requires trade unionists to opt in to the political fund of their trade union when they have already joined that trade union in the past, and I fail to see what reference the Government are making to human rights on this matter. In 2002, the Solicitor General referred to the public interest and human rights when he spoke of retrospective legislation, and I believe that the Bill is such legislation.
Nick Boles
We do not intend to intrude upon the conversation among members of the Labour party, who seem to be having a very good time.
Chris Stephens
Q 320 Just a couple of questions, Mr Taylor. Can you confirm that, in many cases, the workplace will be multi-union and that some unions will be affiliated to the Labour party, and some will not? Therefore, many people already have the choice, because they can choose which trade union to join depending on whether they want to fund the Labour party or not. I should have congratulated you on the fact that you separated Scotland from the UK when you referred to plastic bags, and I welcome that.
I must emphasise to you, as someone who is a trade union activist, that if trade union members are uncomfortable with the trade unions’ relationship with the Labour party, it is up to them to raise that, and there are plenty of democratic opportunities for them to do so. It is also up to the Labour party to justify to the trade unions why it should be funded. The political funds are not just about the Labour party; there are many organisations that receive money from political funds, such as HOPE not hate, so what impact would there be on them?
Byron Taylor: Multi-union representation in the workplace is a reality. I used to organise British Bakeries down in Avonmouth docks, where we had seven trade unions on site. There are a clear number of trade unions, and members can join the appropriate one as they see fit. As for the political fund and its use, it is important to recognise that trade unions do not simply use the political fund for the purposes of the Labour party. There are 52 trade unions here in the UK, 13 of which are affiliated to the Labour party. In the other trade unions, there are a good couple of million people out there paying the political levy to allow their union to conduct political activity. That is what the political fund is for; it is for the conducting of political activity.
There is a proud history for the trade union movement of political activity: the campaign for the eight-hour day, the minimum wage, universal suffrage, campaigns for the NHS, campaigns for housing, peace movements after the second world war—all those things have been supported out of the political fund, and they are appropriate uses for it. What is being proposed is to strip trade unions of that political voice to a great extent. My real fear about this Bill is that it is designed to reduce participation in political activity. Such activity is well established. The European Court ruled just eight years ago that it is perfectly legitimate for trade unions to conduct political activity. The Court said:
“They are not bodies solely devoted to politically-neutral aspects of the wellbeing of their members, but are often ideological, with strongly held views on social and political issues.”
That is a legitimate role for trade unions.
Jo Stevens
Q 321 Can I ask you a question about clause 10? Some people are arguing—wrongly, in my view—that clause 10 equalises the arrangements, mirroring the situation in Northern Ireland. Do you agree that the provisions in the Bill go well beyond the current practices in Northern Ireland, which require trade union members on one occasion to contract into paying into the political fund—I repeat, on one occasion—and they are not required to renew their opt-in?
Byron Taylor: Sorry, can you just repeat the last bit?
Jo Stevens
There is a suggestion that clause 10 mirrors the arrangements currently in place in Northern Ireland about opting in. The question I am asking is: do you agree that the provisions in this Bill go well beyond what is currently in operation in Northern Ireland? Trade union members there only have to opt in on one occasion.
Byron Taylor: Indeed. The Northern Ireland situation is a leftover from the 1920 provision that moved towards an opt-in. Given the unique historical and political circumstances of the Province of Ulster and Northern Ireland, I think there are particular reasons why that exists in the current format.
The Bill, as it is currently proposing to change the law here in the UK, is significant. When people join a trade union, they will have to opt in. If they are already members of a trade union and already paying the political levy, they will have to re-opt back in. We will find ourselves in a situation where people have to renew that every five years. I fail to see why that is required in a fund where you can opt in or opt out at any time, where you have the representative democracy of the union and where you have a 10-yearly political fund review ballot. It seems to be another over-extension. We are going to be in a situation where you can opt in or opt out when you first join the union, you can opt in or opt out at any time, you have to renew every five years, and you have to renew through a political fund ballot every 10 years.
What level of regulation is required on trade union political funds, because they clearly are the most highly regulated political funds in the western world? If you compare them to some of the transparency arrangements that apply to companies, I think they are overbearing. For example, there are unincorporated associations that donate to the Conservative party—one that springs to mind is the Carlton Club, which has donated £1 million to the Conservative party in the last five years—and there is no clarity over who those people are who are paying those moneys and raising those kinds of sums. That is just one example.
Dr Lisa Cameron (East Kilbride, Strathaven and Lesmahagow) (SNP)
Q 322 From your comments earlier, it sounded to me—I do not want to put words in your mouth—as though you were basically saying that the opt-in system that has been proposed within the time period is effectively unworkable. I would be interested in your comments on that.
Byron Taylor: I think it would be very difficult for the trade union movement to conduct those kinds of operations in a three-month time scale.
Dr Cameron
Q 323 What would be the impact of that if it were implemented?
Byron Taylor: There are questions about what is actually being proposed and the format. For example, on the face of it, the Bill requires written communication, but I am not sure if that is what the Bill actually means. One of the things I would particularly like clarity on in the coming weeks is what is the requirement. If it is implemented in the format that is suggested in the Bill, I think you are going to see a significant drop in political fund payers in the trade union movement. The net effect of that will be to remove a whole series of people from the political process in the UK. At a time when we are talking about declining engagement and how we can encourage people to be more engaged in the political process, what we are doing is reducing the number of people who actively engage in politics in some format. That is very bad for democracy in terms of participation and in terms of the funding gap it will create in British politics.
Returning to the Churchill convention, which requires parties not to interfere in matters of other parties without consent, we are going to find ourselves in a situation where the Labour party struggles to compete in electoral terms with the Conservative party.
Stephen Doughty
Q 324 I am intrigued that the Government Minister and the Whip have been going round gagging their Members from asking questions about what is a significant part of the Bill. Mr Taylor, why do you think Government Members are unwilling to ask questions about a significant part of their own Bill?
Stephen Barclay (North East Cambridgeshire) (Con)
On a point of order, Sir Edward. It would be completely unparliamentary for any Member to seek to gag another Member. I assure the Chair that no such attempt to gag Members has taken place. I request the hon. Gentleman to withdraw that suggestion.
Stephen Doughty
Q 325 May I finish my question? Mr Taylor, are you surprised that there appears to be very little Government interest in what is a significant part of their own legislation? What do you think the reasons for that might possibly be?
Byron Taylor: That is a very interesting question. As I said at the start of my evidence, as far as I am concerned, this is a partisan attack on Her Majesty’s Opposition and forms part of a broader attack on civil society. If you look at the concerns being raised about charities’ political campaigning or what is being said about the BBC—it is a deeply partisan attack. It is deeply damaging to our society, and I have real concerns.
I return to the Committee on Standards in Public Life hearings in 2011. Those of you who have read the transcripts will know I gave evidence to that Committee. The argument put forward by the Conservative party and the Liberal Democrat party at that point was that there should be individualisation of political fund payments. The Committee took the majority view that
“such a condition would be a disproportionate intrusion into the constitution of the relevant trade unions”.
That is a really important principle to me—freedom of association and the right of trade union members to come together, form a trade union and determine their own rules and constitution. The Bill is interfering directly in that human right, which I think Amnesty and Liberty made reference to yesterday.
James Cartlidge
Q 326 I want to raise a specific technical point. Mr Taylor, you said this is an attack on funding and that funding will go down. Surely, if people have to opt in, funding will only go down if they had not wanted to opt in in the first place.
Byron Taylor: Funding will go down because people have busy lives and the trade union movement is then required to contact every single member to require an opt-in, when many people already believe they are opted in.
James Cartlidge
Q 327 But if they have been happy with that donation, your donation levels will not be affected.
Byron Taylor: Many people are happy to contribute to the political work of their trade union. It is a fairly well-established principle among trade union members that they pay to the union, and in return they expect good advice and representation.
James Cartlidge
Q 328 But you seem to be saying, “If we actually ask people whether they want to contribute, we’re worried we’re going to find out some of them didn’t want to.” You are admitting that.
Byron Taylor: No, I am absolutely not, because we have not put it to the test yet.
James Cartlidge
Q 329 Then funding will not go down, on that basis. If they are all happy punters and happy to contribute to the Labour party, your funding will not go down.
Byron Taylor: You are saying this is not about the Labour party, and that is your immediate problem, because what we are talking about is the opt-in to the political fund of the trade union movement. What is going to happen is that trade unions are going to have to spend an excessive amount of time and resources re-contacting all of their members to ask them to sign back into the political fund in written form. This is a really important point: it is being proposed that everybody will have to do this in writing. In an electronic age when people should be allowed to communicate via telephone, internet or other forms of communication, this Bill is proposing that everybody has to sign a piece of paper. That will drive down participation; we know that for a fact.
James Cartlidge
Q 330 Forgive me. You talk about people’s rights. You are suggesting that your funds are going to go down. That must mean that some people who are currently contributing would not want to be contributing. In other words, by defending that, you are defending the fact that someone should involuntarily be contributing to a political party against their rights. You are talking about rights; you should surely accept that point.
Byron Taylor: When people join a trade union, there are things that go with being a member of a trade union, including its political work. Let us go back to the history of the opt-out, and 1913, and the legislation and why it was primarily introduced. The opt-out was introduced in 1913 to ensure that those workers who were working in closed-shop arrangements, who did not want to participate in the political activity of the union, had a chance not to do so. In a closed-shop arrangement, union membership was part of the contract of employment, and therefore, they had to join the union, so it was always seen as a way of protecting a very small minority of people who did not want to participate in the political activity of their trade union. We are now in a situation where the Government are trying to change that and say that everyone has to opt in. When people join a trade union, they join the collective and they participate by the rules of the collective. I am unaware of any other membership organisation that an individual can join where they can opt out of a portion of the rules of the organisation they are joining. This is really strange.
James Cartlidge
Q 331 For my last point, I will simply repeat the point that I made, because it is fundamental. If they are all happy donating, you will not be losing any funds when they are asked whether they wish to opt in to making a donation.
Byron Taylor: Do you mean a donation or a contribution to political funds?
James Cartlidge
Q 332 We all know what we are talking about.
Byron Taylor: I am not sure I do, but I would like to come back to what happened in 2008 with the Office of Fair Trading. The Conservative party lodged a complaint on this very matter with the OFT through Jonathan Djanogly MP. The OFT ruled:
“In the present case, we do not consider that trade union members are obviously vulnerable to deceit resulting from the way in which unions collect contributions to the levy. The levy has featured prominently in political discourse and news reporting for a very long time. We would expect to take action if we had evidence that large numbers of consumers are unknowingly entering into an unwanted financial commitment from which they are subsequently unable to extricate themselves. We do not at present possess evidence to this effect in relation to the political levy on trade union members.”
This has been a feature of political debate since the late 1940s. There was the Donovan commission in the 1960s. Look at the reviews of party funding that occurred in the 1990s and in 2004, or the Hayden Phillips review in 2006, or the Committee on Standards in Public Life in 2011. The question that comes back is always, “Where is the evidence that some kind of deceit is being practised?”, because it simply is not there.
If we are going to question the purpose of the legislation, may I draw reference to the Conservative Minister of Labour from 1924?
James Cartlidge
I was minus 50 then.
Byron Taylor: You may have been minus 50, but this legislation was produced in 1913, so it is totally relevant. He said, in a private memorandum, that the
“major part of the outcry against the political levy is not motivated by a burning indignation for the trade unionist, who is forced to subscribe to the furtherance of political principles which he abhors. It is based on a desire to hit the Socialist party through their pocket…we should not delude ourselves as to our intent.”
My question is: what has changed for the Conservative party?
Julie Elliott
Q 333 I have referred to my entry in the Register of Members’ Financial Interests as a member of the GMB and the Labour party, but, in the interests of complete clarity, I was also an officer of the TULO organisation in the northern region for many years before becoming a Member of Parliament.
Byron, can I take us back to the practical impact of this proposed legislation on trade unions and, indeed, the Labour party? Logistically, can you outline how you think this proposed legislation will impact on trade unions, in terms of getting repeated sign-up and collections of moneys, and particularly on the smaller trade unions, which often have very few members of staff? Can you outline what you think the implications of the Bill will be for those people?
Byron Taylor: The implications of the Bill are significant. It is going to impose a great burden of bureaucracy and red tape on the trade union movement. As I have alluded to, trade unions are primarily industrial organisations and focus the majority of their work on industrial activity and dealing with industrial complaints. As for the idea that trade unions will have to divert massive resources—and it will be massive resources—to try to conduct the operations in the way that the Bill envisages, in writing, that is going to be a substantial drain on trade union resources and activities. That will impact heavily and introduce inefficiencies into wider industry, because trade unions are the bodies that are there to negotiate and to ensure that the industry works properly. To introduce this will divert union resources substantially.
If you look at the smaller affiliates of the Labour party or of any small trade union that is now forced to operate in this fashion, they will find themselves caught up in an endless cycle of bureaucracy, seeking people to opt into the political fund, renewing the opt-in and then conducting the political fund ballot. Looking back at the Better Regulation Task Force in 2002, it ruled that trade unions were already over-regulated in the field of political fund activity.
Julie Elliott
Q 334 May I just follow that up with one quick, straightforward question? In the legislation that trade unions operate under, in particular employment law legislation, “reasonableness” is applied everywhere. Would you regard this proposed legislation as reasonable?
Byron Taylor: Would I regard it as reasonable? I come back to the point made by Mr Stephens, and my question would be, is it proportionate, is it reasonable? No, it is not. If there is really some concern about how political funds are being operated in the UK—although there is no evidence to show that there is any concern—is it a proportionate response to ask 4.9 million people to re-opt back into the political fund of their trade union? The answer is no, this is not a proportionate or reasonable response. On that basis, it is clearly a partisan attack on Her Majesty’s Opposition, designed to reduce funding and participation. I fail to see how the Bill increases participation at any level, both in the industrial elements, which I do not intend to speak about, and in the political elements—this Bill seems determined to drive down participation. Where are the means of communication that allow trade unions to talk to their members electronically or via telephone? What we are doing is enforcing a 19th-century form of communication on a 21st-century industry, which is bad for business and bad for the trade union movement.
Ian Mearns
Q 335 Mr Taylor, have you ever made a contribution to the Conservative party by means of buying a good or service from a company whose profits from that transaction were then used to make a donation to the Conservative party?
Byron Taylor: I have, and I had no opt-out from that.
Chris Stephens
Q 336 Just one quick question, Mr Taylor. When it comes to legislation affecting elections, party political administration and funding, or trade union political funding, do you agree with me that it should have the agreement of either all the political parties represented in the House of Commons or a majority of the political parties represented in the House of Commons?
Byron Taylor: Yes. This comes back to my initial point about the Churchill convention, which has existed in UK law for the best part of 80 years, and I will say it again:
“It is a well-established custom that matters affecting the interests of rival parties should not be settled by the imposition of the will of one side over another, but an agreement reached either between the leaders of the main parties or by conferences under the impartial guidance of Mr Speaker.”—[Official Report, 16 February 1948; Vol. 447, c. 859.]
Even Margaret Thatcher realised the danger of interfering in the affairs of other parties. What is being created here is a circumstance in which the party of government is seeking to undermine the party of opposition. That is a very dangerous place to go in our democracy. It is deeply concerning that we find ourselves here, discussing a matter of this kind, when there is no clear agreement between the main parties.
The Chair
I think that is it. Thank you very much, Mr Taylor, for your evidence.
Ordered, That further consideration be now adjourned. —(Stephen Barclay.)
Trade Union Bill (Fourth sitting)
(8 years, 6 months ago)
Public Bill CommitteesRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Chair
We will now hear oral evidence from Professor Keith Ewing, professor of public law at King’s College London. This session will run until 2.30 pm. Professor Ewing, could I just outline how we are going to play this? I will ask you to introduce yourself and outline why you are here. It will then become a hearing, with Members from alternate sides asking you questions. Could you be as succinct as possible? I would urge my colleagues to do the same, but it does not always work that way. Remember that the time you are using is the only time you have, so use it well, if you can. Would you care to introduce yourself?
Professor Ewing: My name is Keith Ewing. I am a professor of public law at King’s College London.
Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)
Q 337337 Professor Ewing, could you set out in a little more detail your experience working on issues around trade union law at a domestic and international level?
Professor Ewing: In terms of my experience?
Stephen Doughty
Yes. Your experience, background and qualifications.
Professor Ewing: I have been professor of public law at King’s College since 1989. Before that, I taught at the University of Edinburgh and at Cambridge. I have taught overseas in many countries. I have worked as an adviser to a number of trade unions, both in this country and overseas. I have worked as an adviser to the International Trade Union Confederation. I do a lot of work with the International Labour Organisation in terms of evidence that I prepare and cases that I help to submit. I work very, very closely, I suppose, with the trade union movement.
Stephen Doughty
Q 338 Thank you. That is very helpful. Given that level of experience, and looking at the Bill as a whole, where do you feel it falls down or potentially conflicts with both international and domestic conventions and law?
Professor Ewing: I have two concerns with the Bill. The first is the extent to which it is compatible with our treaty obligations. The second, because of my other interest, is the extent to which it is compatible with the constitutional principles, conventions and practices that operate in this country.
As far as the first of those is concerned—international labour treaty obligations—there are a large number of treaty obligations binding this country that relate directly to the provisions of the Bill. I will start with the International Labour Organisation. There are three treaties that are particularly relevant and are binding on this country: conventions 87, 98 and 151. I can go into some detail, if you would like.
Stephen Doughty
Q 339 Can you expand a little on where you feel the Bill conflicts with those?
Professor Ewing: Convention 87 is relevant because it deals with the right to strike. The right to strike is not expressly referred to in convention 87, but it has been read into convention 87 by the supervisory bodies over a number of years. One issue that I think arises in relation to the right to strike is the additional requirement of two weeks’ strike notice. There are lights flashing in my head about that. The second issue relates to the thresholds for industrial action, and in particular the 40% threshold for support for industrial action in some sectors. That, too, is beginning to make lights flash in my head about the compatibility with ILO convention 87.
There are two other conventions: 98 and 151, which deal with the question of collective bargaining. Convention 98 applies to collective bargaining generally, and 151 deals specifically with collective bargaining in the public sector. One reason I think there might be problems here relates to the Minister’s announcement after the Bill was published about abolishing check-off in the public sector. I think that will cut across collective agreements and raise questions in relation to 98 and 151.
Another point relates to trade union facility time and the provisions in the Bill, which will give a Minister the right to rewrite collective agreements. That cuts across the idea of collective agreements being voluntary and runs into problems with 98 and 151.
Before I finish, there is the good question of why we should take the conventions seriously. There are two reasons. First, although people were quite indifferent to ILO obligations in the past, the European Court of Human Rights has, since 2008 in particular, begun to pay particular attention to the importance of the conventions in determining the scope and boundaries of the European convention on human rights itself. There was a very important case to that effect in 2008.
Secondly, we are reaffirming our vows to the conventions in the free trade treaties that we are now signing. We signed such an agreement with Korea in 2010, and we are about to sign a free trade agreement with Canada. In these treaties, we commit ourselves not only through the European Union, but as a member state to complying with the international labour obligations to which we have subscribed. The conventions are very important.
Stephen Doughty
Q 340 May I ask a specific question about the certification officer? The Bill’s proposals amount to an extensive expansion of the role. We have heard from other witnesses that there is potentially a serious blurring here between the investigating, adjudicating and enforcing of complaints. Does that breach international conventions or domestic principles about natural justice and not blurring such roles in a quasi-judicial position?
Professor Ewing: The certification officer provisions are extremely serious. I say that partly because we have to bear in mind who appoints the certification officer. Under the 1992 Act, the appointment of the certification officer is in the gift of the Minister, so the Secretary of State effectively appoints the certification officer. You referred to powers of investigation, which are deeply troubling because, in a sense, they give the certification officer this extraordinary power where he thinks there is good reason to do so. That is the test. It is where the certification officer thinks there is good reason to do so. They can then embark upon this extraordinary power of investigation to demand documents, to require individuals to co-operate and to require the attendance of individuals at a particular location. The certification officer then has the power to demand that—[Interruption.]
The Chair
Professor Ewing, I apologise for that interruption. Sometimes technology is to blame. One of the first things people do when they get downstairs and outside is light up a cigarette and that can be a bit of a problem. Mr Doughty, would you like to continue?
Stephen Doughty
Thank you, Sir Alan. I also apologise for the disruption. Sir Alan, I hope with your agreement it will be okay if we need to go on a few minutes longer.
The Chair
I have had a word with Professor Ewing and he says he might be able to finish in the timescale set, but if we cannot, we will continue.
Stephen Doughty
Q 341 Thank you, Sir Alan. Professor Ewing, we were talking about the certification officer. Recalling what you were saying, essentially you are worried that a Minister—a member of the Executive—will appoint an individual who is effectively police, judge, jury and executioner with some fairly wide-ranging powers.
Professor Ewing: Let me say, I hope it was not anything I said that led to the disturbance.
My concern with the Bill is, first, these very extensive powers of investigation, which could eventually lead to someone to being imprisoned for non-compliance. What would worry me is what would trigger that process. What triggers the process is the suggestion that the certification officer can take these steps where he thinks there is good reason to do so. Given the nature of the power that has been given to the certification officer, you would be looking for much a higher threshold before powers of that kind could be triggered.
That is the power of investigation, but there is also the power of adjudication, which has been greatly expanded under, I think, what is now schedule 2. The issue is that the certification officer can initiate a complaint, so in a sense he is the complainant. The certification officer as a complainant will bring his or her own witnesses, cross-examine his or her own witnesses and then make a decision in his or her own cause. They will then have a new power to impose a financial penalty.
That seems to me to be a violation of fundamental principles of natural justice, which apply in this case and I refer to in my written submission: fundamental principles of justice rehearsed by Lord Chief Justices as far back as the 1920s. It would certainly contravene the well-established principle of English and Scots law that no one should be a judge in his or her own cause. I think that provision needs to be looked at very carefully again.
Rishi Sunak (Richmond (Yorks)) (Con)
Q 342 Thank you, Professor, for being here. I want to ask you about thresholds and that part of the Bill. I am obviously not a legal expert on rights, but I think what the threshold provision is trying to do is balance the right to strike—which certainly no one is saying should not exist—with the right of people to go about their ordinary business, send their kids to school, use the trains and tubes, gain access to hospitals and so on. That balancing seems moderate and reasonable. Do you think any weight should be given to the rights of people to go about their ordinary business? Do you agree with the general secretary of the Unite union who, you may have read, has said in principle that he can agree with the idea of thresholds and time-limiting ballots?
Professor Ewing: I do not want to intrude into these very sensitive debates. Whether or not it is moderate or reasonable, I would ask whether it is lawful. That would take me back to the ILO conventions that I referred to earlier—in particular, ILO convention 87—and there to the jurisprudence of the supervisory bodies that emphasise two points.
One is that we should be counting the votes of only those people who vote in strike ballots. If you do not vote, in a sense, you do not count for these purposes. Secondly, when we get to questions of thresholds, the ILO supervisory bodies have said, in a long line and expanding group of cases, that any threshold has to be reasonable. On the question of what is reasonable, what they have said so far is that a threshold of 50% of those eligible to vote is not reasonable. The Bill pitches that at a bit less—at 40%—and the question is, is 40% reasonable?
In determining whether 40% is reasonable or not, I think you have got to take into account the voting methods. The problem with the 40% threshold in the context of the legal framework within which it will be dropped is that it will be dropped into a very rigid system of voting. And if you are going to make an argument for thresholds, I think you have got to be a bit more relaxed about the way in which people go about voting. To have mandatory postal balloting is, I think, probably excessive, too rigid and does not apply elsewhere.
Rishi Sunak
Q 343 Thank you for that. Just so that we are clear, I understand your concerns about the details on how voting works, but in principle you think that the idea of a threshold is fine.
Professor Ewing: No, no, you are putting words into my mouth. My starting point would be the principle of freedom of association. My starting point as a result is that it must be ultimately for trade unions to decide their own internal methods of governance and their own relationships with their members.
If we are going to intrude into that principle of freedom of association that we have subscribed to as a nation, there has to be some compelling reason to do so. That compelling reason has to be compatible with our international legal obligations, and I think there are serious doubts about whether the threshold we are about to introduce will be compatible with the requirements of ILO convention 87.
Rishi Sunak
Q 344 In your opinion, but the ILO convention does accept the principle of a threshold.
Professor Ewing: Well, the ILO supervisory bodies have said that if you introduce a threshold, it has to be reasonable. What I am saying to you is that a 40% threshold in my view is too high in the context of the very rigid voting system we have in this country.
Rishi Sunak
Q 345 I understand, but there is no opposition to the threshold in principle under the convention.
Professor Ewing: Well, the ILO bodies are very unclear. In a sense, they say, “If you have a threshold, it’s got to be reasonable,” but they also say, “You should only be counting people who vote.”
Chris Stephens (Glasgow South West) (SNP)
Q 346 Professor Ewing, in relation to the devolved Administrations, what impact will the Bill have on both their policies and criminal or civil law?
Professor Ewing: This is going to be a really difficult question in the months ahead. The issue here particularly for Scotland is the proposals on the check-off and the powers in relation to facility time—the duty on public bodies to publish facility time arrangements. I think there are two problems here. One is a question of whether these provisions fall within the reserved powers of the Westminster Parliament.
I am sure that a lot of people are taking advice—legal or otherwise—about this at the moment, but I am not sure if the check-off provisions would satisfy the requirement that they fall within the reserved powers of the Westminster legislature and there are lots of reasons why that might be the case. I would hope that the Scottish Parliament will have an opportunity to think about and comment on this question. But, at the end of the day, this is a sovereign legislature and you can push through whatever legislation you think appropriate, whether or not it is incompatible with the devolution settlement. I have doubts about whether all of this package will be compatible with the devolution settlement, but I have no doubt that you have the right to push it through, despite the incompatibility.
The problem that I think will come will not necessarily be a legal one. The problem will be a very severe political problem in the future. The problem will be if a Scottish public body decides, “We are not going to comply with this ban on the check-off,” or “We are not going to publish the facility time arrangements that we give to trade union representatives.” What will happen at that point? We are looking at the question of who will enforce those obligations against Scottish public bodies. Are we really saying that the Secretary of State for Scotland will bring a case against a major Scottish public authority to enforce those obligations? The Government are walking, almost blindfolded, into a major constitutional crisis around the Bill. That constitutional crisis could be as explosive for this Government as the poll tax was for the Thatcher Government in the late 1980s and early 1990s. This is a big, big problem, and I am not sure that people have really thought through the consequences.
Chris Stephens
Q 347 One last question on the thresholds. Do you think that there are also gender equality issues, where in workplaces a majority of women workers might not be able to go on strike because a shift change would impact on them more than it would on male workers?
Professor Ewing: That is a good point, which I had not thought of, and it is something that I would like to think about before coming back to you. I am happy to address the Committee on that point, but I would like to think about it first.
Victoria Prentis (Banbury) (Con)
Q 348 You talked about the ILO conventions. A great deal of your report is concerned with ECHR conventions, and I accept you cannot mention everything in your brief summary today, but would you accept that as recently as last year, the European Court acknowledged that it was legitimate for the Government to legislate to impose some constraints on article 11? Would you accept that there is a wide margin of appreciation for the Government in the way that this can be handled?
Professor Ewing: Are we talking about the RMT case?
Victoria Prentis
Yes.
Professor Ewing: Yes, the British Government won in that case, but what I would say to you is that that case was really quite eccentric. There have been five or six decisions on article 11, specifically in relation to the right to strike, since April 2009, and the only case in which the Court has held in favour of the Government is the RMT case involving the United Kingdom. If I were the Government here, I would not be feeling very complacent or comfortable about that decision, because we have got cases from Croatia, Ukraine, Turkey and Russia in which the Court has said that the right to strike is protected and restrictions have to be justified. That case on its facts accepted that the restrictions could be justified, but you cannot conclude from that that all restrictions will be justified.
Victoria Prentis
Q 349 No, no, and I do not think that anybody on the Government side would disagree that the right to strike should be protected and that restrictions should be justified. That is absolutely the Government’s position. Let me turn it around. Are there any cases that support your view that it is not legitimate for the Government to make proportionate restrictions under article 11?
Professor Ewing: It is quite difficult to answer that question directly, because every case is different. In this case, whatever the challenge is under the convention to this legislation, first, it is not clear yet what the challenge will be, and it will be a strategic question for trade unions to consider which will be the best way in to attack the legislation, I imagine; and, secondly, when the challenge takes place it will also be informed by the influence of other treaty obligations. The European convention is not an island that sits on its own. We have regard to the decisions of the Social Rights Committee of the Council of Europe, which has also expressed criticism about our existing law. We will have regard to ILO supervisory bodies and their views on it. That will help to construct the case, so at this stage, it is hard to know what the case will be. We have got pointers as to what it might be, but the case will have to be built. I guess a very careful case will be built in order to learn from the lessons of the RMT case.
Victoria Prentis
Q 350 Okay. Can we move on to certification officers? I am thinking about the type of person who is a certification officer. It tends to be an Employment Appeal Tribunal judge or people of that type. Do you really feel it is unreasonable for others with a legitimate cause for complaint, because of the results of industrial action, to encourage the beginning of an investigatory process?
Professor Ewing: The certification officer is not a judge. The existing officer is a solicitor or partner in a law firm. Previous officers, I think, were former civil servants who did not have legal qualifications. You are telling me something I did not know, in the sense that the certification officer’s powers are going to be triggered by complaints made to him.
Victoria Prentis
Q 351 No, I am just suggesting that is one type of person who might feel—
Professor Ewing: Are you thinking about employers who might use the certification officer as a kind of surrogate rather than going directly to court?
Victoria Prentis
Q 352 More someone with a legitimate cause for complaint—someone who is affected by strike action.
Professor Ewing: Looking at the powers in schedule 2, we are talking about provisions relating to trade union elections, trade union expenditure and trade union amalgamations. This is about the internal affairs of the union, principally. If employers or whoever have a problem with strike ballots or whatever, they already have a remedy by way of complaint to the ordinary courts, which would be much quicker.
Victoria Prentis
Q 353 I do not want to go on too long, but I was not thinking of employers; I was thinking more of those who are affected by the results of strike action.
Professor Ewing: I am not sure how they would have access to the CO.
Victoria Prentis
Q 354 The certification officer himself might be able to take a view that it was appropriate to investigate non-compliance.
Professor Ewing: Non-compliance with what, in the case of a strike?
Victoria Prentis
Q 355 His job is to investigate non-compliance.
Professor Ewing: Yes, but only with specific obligations. If you look at page 16, the obligations to which the investigatory powers apply are listed in paragraph 1(a) to (h). They do not seem to apply to industrial action. The powers in schedule 2 are to make complaints against a union that he himself will adjudicate. These are powers that relate to the internal affairs and government of the union, so I do not know where the power you refer to arises. This was a power we used to have from the last regime, but I thought it had gone.
The Chair
Professor Ewing, thank you very much. You have been very helpful indeed. We will now move on to the next panel.
Examination of Witnesses
Janet Davies, Jon Skewes, Matt Wrack, Mark Serwotka and Dr Patrick Roach gave evidence.
The Chair
Q 356 We will now hear oral evidence from the Royal College of Nursing, the Royal College of Midwives, the Public and Commercial Services Union, the Fire Brigades Union and, of course, the NASUWT. Ladies and gentlemen, we have until 3.5 pm at the absolute latest because of the difficulties we experienced earlier. We will allow you to introduce yourselves briefly, and the Committee will then put questions to you either collectively or individually. The Government are on the right-hand side, and the Opposition are on the left. The three main political parties in Parliament are present, and all evidence gathered will be available for other Members to browse, if they so wish.
Jon Skewes: I am Jon Skewes, director of policy, employment relations and communications at the Royal College of Midwives. The RCM is a professional body and trade union, representing about 45,000 midwives and support workers in the United Kingdom. We have no affiliation to any political party and we work with all in Government and outside Government. At the end of last year and the start of this year, we took our first industrial action in 134 years in England. That was closely followed by similar action in Northern Ireland; it was essentially on the same dispute. In England, it has been amicably settled with the Secretary of State following discussions. We are particularly concerned about the issues of agency staff, picketing restrictions and good industrial relations in the NHS.
Janet Davies: I am Janet Davies, the chief executive and general secretary of the Royal College of Nursing. We are also a professional organisation and trade union, with approximately 420,000 members across both the public and the private sectors. The majority of our members are registered nurses and health visitors, but we also have healthcare assistants as members. We have never taken strike action in our nearly 100-year history, but we are exceptionally concerned about the Bill, particularly in terms of facility time—clauses 12 and 13—and placing added bureaucracy and added cost on a health service that is already struggling with finances and bureaucracy.
Dr Roach: My name is Patrick Roach. I am the deputy general secretary of the NASUWT, the teachers’ union. We are the largest teachers’ union that organises right across the United Kingdom. We represent about 300,000 teachers. We have fundamental concerns about the provisions in the Bill, including the definition of “important public services”, the use of agency workers and the powers of the certification officer, which we are happy to discuss.
Matt Wrack: I am Matt Wrack, the general secretary of the Fire Brigades Union. We represent some 85% of the uniformed fire service workforce and over 90% of whole-time firefighters across the UK. We have had, which you heard some evidence on this morning, a number of industrial disputes. However, much of our time is spent, through our well established industrial relations procedures in the National Joint Council, resolving disputes at local level before they arise. We have concerns about the impact of the Bill on the rights of firefighters to organise, to protect their safety, which is of particular importance to us, their terms and conditions and the impact that will have on industrial relations in the fire service.
Mark Serwotka: I am Mark Serwotka, the general secretary of the Public and Commercial Services Union. We have a quarter of a million members—overwhelmingly, civil servants and public sector workers working on public contracts and in non-departmental public bodies—and a significant membership in the private sector as a result of outsourcing where people have remained members of PCS.
We have lots of concerns about the Bill, but I know that you are hearing lots of evidence, so I will just draw particularly to your attention at this point the effect of the Bill on people’s right to take lawful industrial action. We are particularly representing public sector workers, who in our case have had 11 years of pay restraint. Secondly, we think much of what is in the Bill was trialled in the civil service by the last Government. Therefore, we have direct experience of the withdrawal of check-off, the withdrawal of facility time and the attempt to openly undermine trade unions by public servants working at the Government’s behest. Thirdly, as a non-affiliated public sector union that spends over £1 million a year on campaigning, much of which is political but not party-political campaigning, we have very clear concerns about the effect of the changes to the political fund rules.
The Chair
Thank you. Before we proceed to hon. Members asking questions, can I just tell you that we have only until five minutes past 3? Our time is very brief, so please be aware of all the time you are using in the replies to the questions put to you. Try to make them succinct, because you are using each other’s time up. I am just giving you a bit of advice. If you could be helpful to both Members and yourselves, that would be much appreciated by Members.
Stephen Doughty
Q 357 I have a few short questions that I would like to put to different groups if that is okay. First, to Jon and Janet, given what we have heard about the relatively small incidence of industrial action in the history of the health sector, particularly in relation to your two bodies, fundamentally do you think that this Bill is needed?
Jon Skewes: Not at all. I do not think we have plans to repeat that industrial action over and over again by any means. I think we think it is disproportionate, absolutely; and also it could be quite dangerous in terms of safety in the NHS.
Janet Davies: We do not think it is necessary at all. In fact, we think it will damage relationships, which are very good in the health service. We know that productivity is increased with the facilities time and with having trade union representatives in the workplace. We know it affects patient safety. We think it will be expensive. We think it will introduce extra bureaucracy and could be quite damaging for the good relationships we have got, which could have an effect counter to what is required.
Stephen Doughty
Q 358 Janet, we had a Government witness yesterday, from an organisation called 2020 Health who, you may have heard, had a whole half hour to explain that they did not appear to know anything about the Bill. Nor did they know what facilities time was. Unfortunately, you have not got very much time, but could you briefly give us an example of how facilities time benefits employees and patients?
Janet Davies: Yes. We know that facilities time has benefits; we have looked at the evidence and the University of Warwick has done some studies for us and we know that productivity is increased. Certainly, in terms of staff leaving and recruiting, it is much better in a place where there is trade union facilities time, and where there are trade union representatives. Actually, we have worked out that that difference in turnover would save an average teaching hospital £1 million a year. It is a really positive effect that the time gives.
What happens is that our trade union representatives work in partnership with employers, often introducing change, introducing new clinical practice, and investigating things and stopping problems before they start. The proposal could be counterproductive for the good relationships that we have at the moment. Importantly for us as a nursing organisation it could have a detrimental effect on patient care, as it would seriously affect the positive practice environment that we try to create.
Stephen Doughty
Q 359 Thank you for that. Matt, we heard some evidence from the London Fire Brigade this morning and you have referred to it. I wondered whether you wanted to respond to any of the comments and whether you could also tell us about the different approaches to industrial relations in the fire sector across the UK. Some quite important contrasts were drawn between what has happened in Wales and what happened in some disputes in London.
Matt Wrack: Yes, I do want to correct the impression that was given this morning. I have known Ron Dobson a long time and was surprised to hear some of the things he said. He mentioned that he was unaware of any arrests. There were two arrests in that dispute. They were not of FBU members. One was of a non-union middle manager and one was of an agency driver—in both cases for driving into members of the Fire Brigades Union. Two of our members were injured, one of whom is sitting in this room, behind us. Ron Dobson was also unaware of the outcome, which is again surprising because his own authority paid compensation to the two FBU members who were injured as a result of those two incidents.
Stephen Doughty
Q 360 So you were surprised that he did not appear to be aware of that fact.
Matt Wrack: I am surprised that the senior executive of that organisation did not know that his organisation had paid compensation to two members of mine who had been injured by agents of his during an industrial dispute.
He also used the word “barricades”, which gives the impression of watching “Les Mis”, or something. There were no barricades on London fire stations in 2010. It is utterly misleading to claim that. He also was asked a question, by Jo Stevens, I believe, about the unlawful docking of pay. He said that three cases had been settled. Most people will know that actually in many such cases you run test cases. We ran three test cases of 368 individuals who had had pay stopped. We won those test cases. The London Fire Brigade has decided not to appeal, and the London fire authority has set aside several tens of thousands of pounds to pay compensation for the 368 Fire Brigades Union members who had pay unlawfully stopped. Those are the facts of the situation.
Stephen Doughty
Q 361 It is very concerning to hear that, and the commissioner made it clear that he would write to the Committee with some of the information that he did not appear to have at his fingertips. I hope that he will correct some of what he said in the light of what you have said to us just now.
I want to ask about devolution and perhaps this could be touched on broadly across the panel. Clearly, you all operate in public services that are, to a large extent, wholly or partially devolved across the UK. We have just heard from Professor Ewing that the Bill could lead to a fairly serious constitutional crisis in terms of cutting across the devolution settlement. How would you respond to that? Do you think that there are serious risks for relationships across Wales, Scotland and local government across England, of which the Bill shows no awareness, and does not address? I am happy to take a couple of comments, though I am sure we do not have time to hear from everyone.
Mark Serwotka: I share Professor Ewing’s concerns, and I will illustrate that with these examples. We have very good industrial relations currently, for example, in Scotland and Wales with the devolved Administrations, who have sat down and agreed with us the need for positive industrial relations, and made it clear that they do not wish to see the withdrawal of check-off or facility time. What we are in danger of seeing is those bodies that have entered into agreements with their workforce for the smooth running of public services being compelled to act against what they think is in the best interests of themselves as an employer and public service users.
That is particularly concerning because if we look at the civil service when this was done, the last Government effectively compelled all Government Departments to do the same thing, under the guise of this activity being a waste of taxpayers’ money. The Committee needs to know that in the civil service our union offered to pay every penny of every cost that was required to take check-off, so there would be no cost to the taxpayer. Not only was that rejected, but we saw the absurd situation in the Department for Communities and Local Government, where Eric Pickles, as the Secretary of State, withdrew check-off. We took him to the High Court; he lost the case and we won it, on a contractual right to check-off. He cost the taxpayer £100,000 to save £320 a year in the entire Department’s administration.
Stephen Doughty
Q 362 Given what you have just said and given the evidence from the Welsh Government and others, do you think that there is a serious risk here that we will end with significant legal disputes about contractual provisions that have already been entered into, particularly with regard to check-off?
Mark Serwotka: Absolutely inevitably and it will be very, very costly, as the example I have just given proves. We can furnish you with the evidence of that case.
Stephen Barclay (North East Cambridgeshire) (Con)
Sir Alan, I will just point out that Opposition Members have used up pretty much half the sitting so far, before there has been any question from Government Members.
The Chair
We have sittings such as this one to try to get the message across. I have got a little bit of leeway to gain back time; I am aware of that. But I would like to move on, because the next questioner is Edward Argar.
Edward Argar (Charnwood) (Con)
Q 363 Mr Wrack, thank you very much for your clarification there, particularly of that court case, and thanks to my hon. Friend the Member for North East Cambridgeshire (Stephen Barclay) for his comment. Going back to the evidence from the commissioner this morning, in the course of that dispute in 2010, was access in any way to any fire station being used by contingency crews impeded by any FBU members at any point?
Matt Wrack: Again, I found it somewhat surprising that Mr Dobson presented it in that way. We had pickets on fire stations, as we are perfectly entitled to do, and there were no such barricades. There was a police presence on some occasions. We co-operated, and we had interesting evidence from the police earlier today. We co-operated with the police on every occasion that there were discussions. It is utterly misleading, as again was suggested, to say that there were any delays to emergency calls as a result of the actions of FBU pickets during that dispute.
Edward Argar
Q 364 That is not quite what I asked; I am grateful for that, but it is not quite what I asked. Did those pickets in any way impede any ingress or egress to and from those stations?
Matt Wrack: They were picketing their place of work. What happened in general is that the replacement agency staff drove up to the fire station and drove off.
Edward Argar
Q 365 So you say that they were picketing their place of work. What happened in general? Were there any occasions when access was physically blocked?
Matt Wrack: I think I have explained that. Firefighters were picketing their place of work. Replacement agency staff drove up and drove off. That is what happened. There was no pushing and shoving; if you have got images of 1970s TV programmes, that is not what happened in any of these situations.
Edward Argar
Q 366 Would you agree or disagree with the view—I suspect that I know the answer, but I will ask the question—that what you have just said, if we accept it, that some people drove up and drove off again, shows that those people felt intimidated by the presence of those pickets and the behaviour, which caused them to drive away again?
Matt Wrack: Let us be clear about the right to picket. The right to picket is being interpreted by some people as an attempt to intimidate. The right to picket is about trying to persuade other workers to comply with the call to take action. In this case—again, Ron Dobson seemed to forget the cause of the dispute. The cause of the dispute was that he had issued a sacking notice to 5,000 London firefighters; the entire workforce were being sacked. So you can imagine that some of them were quite irate about that. However, where we had the opportunity to speak to those agency replacement staff, we did so, and in a number of cases the police assisted us in doing that. We put our case to those agency staff; unfortunately, they carried on with the work they were undertaking.
Edward Argar
Q 367 I have a couple of very quick follow-ups. You will be familiar with the Carr report. Paragraph 4.66 refers to evidence provided by Assistant Commissioner Dave Brown on behalf of the London fire brigade, in which he made a number of allegations. I would be grateful for your reaction to them, either collectively or individually. He said that,
“tactics included…Stations left open or barricaded and fire alarms activated…Security codes at fire stations changed…Station gates padlocked and crews cars blocking forecourts preventing access for stand-in crews.”
Those are just a few of the number of things he suggested. Do you have any reaction to the assertions in that report, Mr Wrack?
Matt Wrack: Again, I have known Dave Brown a long time. I worked on the same watch as him at one point. His report has not been backed up by any evidence. The interesting point in all this is the question: what did the police do? If there were concerns about this and implications of serious breaches of public order, the police would have intervened. The police did not intervene. We had good relations and good co-ordination with the police throughout all the protests that took place during that dispute. None of our members were arrested. The only two arrests were of two people who decided to work through that dispute and ran over two people who were protesting. I reject those suggestions from Mr Brown, but we are happy to look at any evidence that he actually has with any detail on that.
The Chair
May I point out to people giving evidence and answering questions and to Members that we are approaching having used two thirds of our time? We should make it more succinct if you want to get the answers in. I call Chris Stephens.
Chris Stephens
Q 368 Thank you, Sir Alan. First, I ask the panel for their thoughts on whether they regard the threshold proposal to have any impact on women who wish to pursue industrial action. Secondly, can they give examples in relation to their political funds? I believe that they are all at the moment not affiliated to a political party. How will the Bill affect those political funds, and what organisations will it affect?
Mark Serwotka: Very briefly, the changes to political funds will have an enormous effect. People should not confuse it with affiliation to the Labour party in our case, because we are non-party politically affiliated. It is timely that we have been asked that question, because I am here on the very day that the Government announced that they were essentially backing down on the privatisation of criminal fines enforcement in the Ministry of Justice. My union has waged a five-year political campaign pointing out that that privatisation is wrong, and the Government have accepted that argument today.
A year and a half ago, we made a political argument not to privatise the Land Registry, which was also successful. Those campaigns are funded by political funds, which would be devastated by the opt-in, rather than opt-out method. It would massively curtail things. Directly, there is evidence that had we not run those campaigns, the Government would probably have made the wrong decision on two occasions.
On the right to strike—I will keep this short so other people can speak—all I would say is that in my union, it is predominantly the women membership who are suffering from 11 years of low pay and freezes to tax credits. Some 40% of PCS members claim tax credits. It is quite clear that there is a disproportionate effect on them if their ability to strike is undermined.
All I would ask the Committee is to consider this: do the Government really care about thresholds? Over the past 10 years, during the last Labour Government, the coalition Government and now, I am on record as saying that we would love to sit down and talk about changes in ballot methods to allow secure, online workplace balloting. In my union, we have done pilots. Where the law allows ballots in the workplace, the turnout is treble what it is when you have a statutory ballot by post. There is irrefutable proof that in comparable elections, three times the number of people vote in work. We have the technology to do it securely. That is what the Government should be talking about, because that would have a massive upwards effect on turnout.
Matt Wrack: Very quickly on the political fund, we were affiliated to the Labour party. We are not currently affiliated to the Labour party, but we have a political fund. Our members have the right to opt out of that political fund. In our union, they also have the right to make clear that they would not want any political fund going to a political affiliation, even if we were affiliated. They have a number of choices on the political fund. As Mark said, our political fund is primarily used for key political campaigns around the terms, conditions and safety of firefighters. In our view, were the Bill to proceed, it would seriously undermine our ability to function in that regard.
On the point about balloting, we note that both major political parties have recently used modern forms of balloting—for example, electronic balloting has been used by the Tories for the appointment of the candidate for London Mayor—so it seems bizarre to us that trade unions are being told that we cannot use such balloting methods going forward.
The Chair
May I pause you for a second? We have 10 minutes remaining and four Members want to ask questions, so we need to speed up the replies and the questions.
Seema Kennedy (South Ribble) (Con)
Q 369 Dr Roach, when your members go on strike, the people affected will all have to arrange alternative childcare because of the nature of your members’ profession. In relation to clause 7, which is on the notice period, do you not recognise that giving parents 14 days, rather than seven, would give them more scope to organise alternative arrangements?
Dr Roach: We do not agree with the proposed measure to increase the notification period for industrial action. It has to be borne in mind that, as a trade union, we are engaged in industrial action that does not always include strike action. In fact, by and large, our industrial action is pupil and parent-friendly. It includes action short of strike action, which is to say working to an idea about what the teacher’s contract should be in order to raise educational standards, so that children’s education is not disrupted.
Seema Kennedy
Q 370 But when there is strike action and there is disruption to children’s education and their parents’ ability to go to work, would you not recognise that giving them 14 days’ notice would give them more ample opportunity to re-arrange their lives, so that they can contribute to the economy by going to work?
Dr Roach: I am not going to challenge the logic of what you are saying. What I would argue is—
Seema Kennedy
Q 371 So you accept it then.
Dr Roach: I am not going to challenge the logic of the argument you have put forward. The best way to minimise disruption to parents up and down the country is through sensible dialogue, genuine negotiation and a will to resolve industrial disputes before disruption becomes necessary. I would take you back to a point I made at the outset: by and large, our industrial action features action short of strike action, which does not disrupt the rights and ability of parents one jot. At the moment, we have in the Bill a blanket or universal provision affecting all forms of industrial action. That seems to us to be unnecessary and disproportionate.
Jo Stevens (Cardiff Central) (Lab)
Q 372 I have a question for Mr Skewes. Earlier this week, we heard from a Government witness from 2020 Health who seemed unaware that trade unions already have life and limb cover in hospitals when industrial action is taken. Do you believe that the Government’s wider proposals on the use of agency workers during strike action are required?
Jon Skewes: No, not at all. The last thing the English NHS in particular needs is more agency workers, the cost of which has gone up by a factor of 11 over the past two years. If there were proposals to bring in agency workers instead of, for example, midwives, first of all, someone attending a woman giving birth has to be, by law, a midwife or a doctor. We think it would undermine quality and safety. Frankly, in our last industrial action, we ensured that every women in this country had the service that would normally be available to them. Most of our members were not on strike—I would say that 90% of our members were providing that cover and 10% were on what were essentially protests. I think that that was hugely supported by the British public.
There are a number of other things. First, there are not that many of those people. If we look at the figures—I think this is in our written evidence—most agency workers are already working in the NHS at the moment. They are probably also our members, so the agency workers themselves would be on strike.
Secondly, I think it would have a really bad effect on team morale and the way in which safety is underpinned. Those people do not have the knowledge of trust safety protocols, quality protocols and so on. We resent the fact that, given the way we absolutely went out of our way with trusts and NHS England to underpin safety during that dispute, we would be faced with a dilemma in the future. Do we allow them to just replace our members with agency workers, which would be much more costly but we know would not be as safe? I do not think we would do that. It is a dilemma that we resent.
The Chair
Two Members want to ask questions. I am going to take them both together. If for any reason you wish to come back in the short period we have got left, I will allow that.
Rishi Sunak
Q 373 I have a quick question for Mr Serwotka. I understood your points about online balloting. Just so I understand, do you support the principle of a threshold for strike action, so that when there is disruption to the public services that people depend on, they know it has been backed by a reasonable number of members involved?
Mark Serwotka: No, I do not. Unless the Government were to say that thresholds should apply to all referendums and all other comparable ballots, it singles out the trade unions. It means that people who do not vote are counted as no votes, which to my mind is completely unacceptable.
Ian Mearns (Gateshead) (Lab)
This is a question for Dr Roach. The NASUWT organises across England, Wales, Scotland and Northern Ireland. Could you let Members know whether there is any significant difference in levels of industrial action in the four areas, where the governance is different?
Dr Roach: Yes, we do indeed organise right across the United Kingdom. There are very real differences in the industrial relations contexts in each of those jurisdictions. Our ability to engage in genuine dialogue with the Administrations in Northern Ireland, Scotland and Wales is, frankly, far superior to our ability to engage in genuine dialogue, with the view to resolving teachers’ very real concerns about their pay, pensions, working conditions and job security, in England. There are acute differences, but I would come back to the issue of the importance of the trade unions’ ability to represent the interests of their members. They ensure that their members’ working conditions are adequately protected through the use not only of strike action but of other means, including the intelligent use of action short of strike action. That has been an important mainstay of our strategy for protecting the interests of our members right across the UK.
The Chair
Thank you very much. That brings us to the end of the time allotted to your panel. Thank you very much for attending. If we have any queries arising from the evidence you have given, we will be in touch to ask you to reply.
Examination of Witnesses
Len McCluskey, Sir Paul Kenny, Frances O’Grady and Dave Prentis gave evidence.
The Chair
Q 374 First, may I welcome you all to the Committee? It is an illustrious bunch we have in front of us who represent an awfully large body of members. It is very rare that Parliament has the opportunity to get such a group together and ask them questions. You will very quickly introduce yourselves to the Committee. We will then move on to queries and questions from Members, which will alternate between the Government and Opposition sides. We will go to Members who wish to raise questions relating to the Bill.
Dave Prentis: Good afternoon, everybody. My name is Dave Prentis. I am general secretary of Unison—the public service union of 1.3 million paying members who provide our public services. We recruit everybody in public services, except doctors and teachers. We do compete for members with other unions—probably 10 in local government and maybe 15 in the health service.
My view is very strongly that the Bill as worded at the moment is a major attack on workers’ rights in this country, and it will make industrial relations, especially in public services, far more difficult. We have partnership working throughout all of our public services. We have agreements that bring in many of the issues that are going to be made illegal and we think that it will lead to far worse industrial relations.
Frances O'Grady: My name is Frances O’Grady. I am the general secretary of the TUC, representing 52 unions who organise around 6 million workers UK-wide. The TUC opposes this Bill and the associated proposals. We believe it threatens fundamentally the right to strike and other critical civil liberties in this country. We note that the Regulatory Policy Committee said that the Bill was not fit for purpose, and we believe that it would fundamentally shift the balance of power from ordinary working people towards employers and make it harder for unions to defend jobs, pay and fairness at work.
Can I add that I am conscious that a good deal of the debate has focused on thresholds, even though that contravenes the ILO’s clear standards on this issue? It is important to note that, even if all those tests and thresholds were met, the Government also propose that employers should be able to replace striking workers with inexperienced and possibly untrained agency workers, therefore completely pulling the rug from beneath the right to strike. We know that if this was about improving turnout in ballots, the best way to do that would be through allowing unions to use electronic and workplace balloting.
I end by saying I think it is important to be clear from the start that we believe that the real aim of this Bill and the proposals that go with it is to give employers new ways to take unions to court and thereby impose penalties and seek damages and injunctions against unions. I would suggest that the approach of this Bill is straight out of Norman Tebbit’s textbook from the 1980s.
Sir Paul Kenny: Paul Kenny, general secretary of the GMB—not a failing business, as some people might have you believe. We have actually, as a union, grown every year for the last 10 years, so we must be something right about appealing to people. We are opposed to the Bill. We had 625,000 members all above ground as at the end of 2014. That figure is now at 635,000.
I will not take a long time. We have agreements with global players, as well as household names that you would know, from energy companies to Asda-Walmart—the only collective bargaining agreement they have anywhere in the world is with us in this country, and they do not see, as I understand it, a need to support this Bill, either. I would describe my view personally and that of my colleagues by saying that, if this Bill was on the pudding menu at the Carlton Club, it would be called an ideological Eton mess.
Len McCluskey: Len McCluskey, general secretary of Unite, Britain’s largest union, with 1.4 million members, covering all sectors of the economy—manufacturing, transport, financial services and public services, as well as private services. I obviously agree with all the comments my colleagues have made. The Bill is a threat to democracy; I think you have been told that by a whole range of different organisations from across the spectrum of our society. It is also a threat to the cohesive nature of the communities in which we work. I am hoping that this Committee will record our views as clearly and sincerely as possible, and that the Prime Minister and the Government might rethink elements of the Bill.
The Chair
Thank you. Although you have chosen not to send along national officials of various sectors in your union, which is a very large group of organisations, the same rules apply. We will have a series of questions asked, with replies and opinions given back. We only have until 4.15 pm to do that, so we need to do it quite succinctly. If not, you are using your own time. Members might ask you to go on and on, but what you want to do is get as many replies across as possible.
Len McCluskey: Sir Alan, I have brought some additional written information that I can present either now or at the end of the session.
The Chair
Len, if you hand it to the Clerk, we will distribute it to all Members in due course.
Stephen Doughty
Q 375 Frances, can I turn to you first? Correct me if I am wrong, but I think you said that the TUC represents 6 million workers—one tenth of the UK population. That is a huge number. Given the severe implications of the Bill for a whole range of issues and its potential impact on those individual members and, indeed, the member unions of the TUC, are you satisfied with the level of consultation and how the Government have gone about the consultation in drafting and presenting the Bill?
Frances O'Grady: Absolutely not, nor was the Regulatory Policy Committee. I am afraid that bad laws are made in haste. We were given an eight-week period over the summer holidays for the consultation period, and of course that has left huge holes and uncertainty in the proposals, which I am very happy to list separately. Very big and important questions appear not to have been considered and thrown in belatedly—for example, the proposals on removal of check-off in the public sector. Critically, this has meant that unions, employers and those with practical experience of industrial relations have not had the chance to influence the nature of the Bill in the way we should. I think it contravenes the Government’s own standards in that respect.
I have been pleased to belatedly have contact with Department for Business, Innovation and Skills Ministers and officials, but I wrote to the Prime Minister on 15 May, following the election of the Conservative Government, asking to meet to discuss precisely this issue, and I have not yet received a reply. Frankly, I think my members would see that as discourteous to working people.
Stephen Doughty
Q 376 So the Prime Minister is not willing to meet an organisation that represents a tenth of our population—that is quite surprising. Are you also surprised that we are discussing the Bill, in both this format and the line-by-line sessions, without having seen the responses to the consultation process from the Government or much of the secondary legislation that the Bill gives them very wide powers to implement?
Frances O'Grady: Absolutely. Perhaps there will be a question later on this, but it is not just unions that are worried about it; employers are, too, because we believe it poisons industrial relations in this country.
Stephen Doughty
Q 377 Thank you. I wonder if I could turn briefly to Dave. I understand Unison has significant concerns about the aspects of the Bill that address facility time, check-off and so on. Could you briefly outline your key headline points of concern?
Dave Prentis: I will try to be as quick as I can. To deal with check-off, these are voluntary arrangements made with employers. No employer is forced into the arrangement. We have 9,334 check-off arrangements with separate employers, 7,242 of which are in the public sector. It is a means by which we organise our partnership work and it is based on three contracts. There is the contract involving the member agreeing the payroll arrangement. It is voluntary, and they are given the option of other means of paying. There is a collective agreement with the trade union, part of which includes training arrangements, facility time and check-off. Obviously, there is also a contract between the union and the member. The systems work incredibly well. From an employer point of view, they know who is in a union.
You can have deductions at source for 14 or 15 different things, including buying a bicycle, paying crèche charges or for season tickets. Why would an employee’s contribution to their trade union be the only thing excluded? Why are the Government pushing auto-enrolment for pensions, which we think is right, while denying trade unions the ability to collect money? It singles out trade unions and will have a major effect on partnership working in health, schools and local government, because the arrangements are part of our participation arrangements.
If we have to spend all our time seeking to transfer people over, that means changing 800,000 people from check-off to direct debit. It will be a massive undertaking, using all the union’s resources. We represent 1 million women members, most of whom are low paid, and we do not see the need to disrupt arrangements that employers have been willing to enter into. It about localism. It is about the employer having the right, at the local level, to decide what agreements they want to reach with their trade union, without having authoritarian legislation preventing them from doing so. There is no logic to singling out the public sector and not the whole economy. It is based on prejudice, and it will badly affect our working relationships with the employers that recognise us.
Connected to this is time off for trade union duties. I will be as brief as I can. Our relationship with employers is based on our local reps having partnership working with them, sitting in the committees that deal with major issues, and representing people in the workplace, which the employers need for their disciplinary or grievance procedures. This is all done by activists under the time-off arrangements. If those arrangements are taken away from our people, it will mean that the joint working that has been fostered in public services since 1948 will become far more aggressive. There will be far more industrial action, and we will have major problems.
We have union learning reps who are involved in getting people to train not just as stewards, but professionally. We do dementia, mental health awareness, lesbian and gay rights and service user training. We provide training for the employers when they sign the agreement. Many thousands of low-paid public service workers benefit from this. They actually get on in life through this and get promotions as a result. All of that will end if these draconian attacks on check-off and facility time take place. They are part of the fabric of the work that we do as a union across all our public services.
Stephen Doughty
Q 378 That is very helpful. Turning to another section of the Bill and the provisions that deal with picketing, we have heard the police’s serious concerns, shared by many witnesses, about the workability of a number of the proposals, in particular the proposals in the consultation relating to policing Facebook and Twitter. What has your experience of picketing been? Do you think that these proposals would simply not work?
Sir Paul Kenny: The reality is that the police are looked at in picket line situations almost exclusively as the middle people. They are independent and the co-operation with the police, which is vital for the police to do their job, comes about as a result of being seen in that light. With these proposed regulations, effectively, it is a whole new ballgame.
Please, do not anybody tell me about intimidation on picket lines. I have seen lots of it. I have seen people blacklisted from work for 20 years because they stood on a picket line. I have seen people intimidated about going back to their job by managers, but there is nothing in this Bill is about any of that, is there? I hear—it is illusionary, almost—these stories about intimidation on picket lines. My experience is that the police are effective at dealing with that, and they do it by consent and they do it clearly. It is not what trade unions condone or seek and the police operate very much on a consensus basis.
The side wagons to the main Bill—if you will forgive me for putting it that way—are issues such as the notice-posting and the rest of it. This is just beyond belief. It would be uncontrollable by us anyway—that we would be able to predict what is going to be put on Twitter or Facebook by other people, who may not be particularly connected with the union at all—but we would effectively find ourselves involved. You are criminalising what is effectively a civil right. That is why I described it earlier as just a mess. This is clearly a mess.
Stephen Doughty
Q 379 Can I ask a separate question on participation? Perhaps some of the others will want to answer; I know that Len has concerns about that. As union representatives, I am sure that you all want to increase participation in ballots and to see the maximum turnout in those. We have heard a lot about the fact that the Government do not seem to be willing to consider e-balloting, secure workplace balloting and other methods. Could you briefly comment on that, Sir Paul, and then Len? I looked closely at your evidence, Len, and you speak about Central Arbitration Committee ballots, for example, where secure workplace balloting is already used. What are your views on why the Government will not accept methods that would boost the participation that they say they want to see?
Sir Paul Kenny: I will briefly answer, then pass the question to Len. In a sense, this gets to the heart of what this Bill is all about. This is a dishonest approach, because if it was really about getting more people to participate and more people to engage, you would modernise a balloting process that is actually a third of a century old. That is how old it is, but the truth of the matter is that you do not want to. The Government are not seeking to help people to participate or seeking to get conflict resolution. If you think frustrating people through a ballot will mean that the problem will go away, it will not. It will get bigger and then it may erupt in a way that is not controllable by the selected agreements. This is absolutely a dishonest approach.
Stephen Doughty
Q 380 So facilitating better participation would benefit industrial relations more.
Sir Paul Kenny: Of course. I forget how many countries use this now, but a whole host of countries do. There was a quote from the Speaker’s Commission saying this was unfair, or unreliable, but I am not sure that that is actually what they did say. I went back and had a look at it and I do not think that is right. Clearly, people are talking about maybe modernising our general election participation by moving to electronic balloting. You clearly want the vast majority of people to participate. That is what you want, and it is why the thresholds issue is not one that I am particularly—I would like to see every person participate, but this Bill does not even attempt to deal with the issue of encouraging people to participate, thereby encouraging dispute resolution. What it seeks to do is to suppress it and therefore foster it.
Len McCluskey: Obviously, Paul has made the point that this is the nub of the Bill. In fact, the Prime Minister himself on 4 October, in an interview with Andrew Marr, made it clear that lots of things in the Bill can be debated and discussed. The inference was that they could be changed and amended, but he said that this was the most important element of the Bill. Everyone in this room will know that I have written to the Prime Minister suggesting that if he is genuine about wanting to increase the turnout, given that he has expressed his concerns about low turnout, which all of us have concerns about, then he should move towards, and get involved in a proper debate about, modern methods of balloting—the same balloting that the Conservative party has just elected their London mayoral candidate with—and most importantly, secure workplace balloting. All of that is feasible. The Electoral Reform Society has said that that is easily achievable with independent assessors.
You asked me, Stephen, why it is not being supported, but you need to ask that question of your colleagues opposite in the Conservative party. When you are considering the whole nature of the situation, you have to ask yourself what is wrong with secure, independent workplace balloting. The point that Paul makes about where this may lead us is something that members of this Committee, and indeed the Government in general, will need to consider seriously. We may well find that our members—ordinary, individual, decent trade unionists, who contribute massively to the wealth of our nation—are pushed outside the law. What this Bill will do, if it is not changed, is to require general secretaries such as myself to repudiate, or distance themselves from, those workers. Unite will not do that. We will not repudiate and we will not distance ourselves from people who are engaged in legitimate action.
I have said to the Prime Minister, extending the hand of pragmatism, “Please sit down with us. There is no reason why you cannot concede the principle of independent, secure workplace balloting. If you did so, the issue of thresholds would become an irrelevance. Workplace balloting would consistently produce high turnouts.” I am puzzled as to why there has not been a positive response to that offer. I am confused about why that was not snatched at immediately, unless the Prime Minister is being disingenuous. With the greatest respect, I have to say that it did not fill me with confidence when he said yesterday in Prime Minister’s questions:
“I notice that Len McCluskey now supports our position.”—[Official Report, 14 October 2015; Vol. 600, c. 314.]
That is wrong and disingenuous, and he knows that. My appeal to him, to the Government and to the Conservative members of the Committee, is: please, stop playing games and tell us why you believe secure workplace balloting is not acceptable. Nobody is giving a reason. If that was grasped in the manner in which it has been offered, a huge element of the controversy surrounding the Bill would be removed.
Frances O'Grady: Chair, I wonder if I can add very briefly to that. I know that this issue of safety and security has been raised a number of times, including by the Minister in a meeting I held with him—although I think, Nick, you actually quoted the lack of security of a postal ballot in a local authority election, perhaps in error.
The real issue here is: is electronic balloting any less safe than postal balloting? The Electoral Reform Society report confirms that it is no less safe, given the risk run in postal balloting. Of course, a number of employers, such as the Royal Bank of Scotland, use electronic balloting already to elect worker representatives to their consultative committee. We see it used across a whole range of organisations, including political ones. Frankly, if it was not safe, that selection ballot for the Conservative Mayor of London candidate should be rerun as a postal ballot.
The Chair
May I just say that we have got a very short period of time left? The purpose of the session is to get in touch with you. You got in touch with us and said that you wanted to say things, and we said that we would like to ask questions of you. I have got about seven or eight Members of Parliament, on both sides, who want to do so. If you can be more succinct—that goes for Members too—we will try to get as many answers out as possible, and that may help both sides.
James Cartlidge (South Suffolk) (Con)
Q 381 I thank all four of you for coming. I am pleased that we have focused on the thresholds issue, and I agree that it is by far the most important point. In evidence on Tuesday, we heard a large number of examples of serious disruption caused to ordinary members of the public on relatively low turnouts. For example, David Martin, who is a director of Arriva buses, which operates in London, referred to the London strike in 2012. He said:
“The fact that 17% of my staff voted and 50% of the buses did not run in London over that period of time shows us that we need a failsafe, and this Bill delivers that failsafe.”––[Official Report, Trade Union Public Bill Committee, 13 October 2015; c. 7, Q4.]
My question is for Frances O’Grady. At the beginning, you mentioned thresholds in relation to the ILO, and we are now talking about thresholds in relation to e-voting. Are you saying that you oppose the threshold change in principle or that you would accept it if it came with electronic voting?
Frances O'Grady: The TUC’s position is very clear. The labour arm of the UN is very clear that you cannot count abstentions as no votes. We are arguing for a positive, 21st-century solution to boosting ballot turnouts by using modern means, including electronic balloting, in a way that is safe and secure and independently supervised. If that is what this is really about, give us the right to do it, as many of the organisations represented around this table—
James Cartlidge
Q 382 When you say “what this is really about”, this is not a conspiracy. We are extremely concerned about ordinary members of the public whose lives are disrupted when schools close, when buses and trains are not available and when London comes to a standstill on the basis of a ballot that has a low turnout. If it has a high turnout, we accept that. We accept the right to strike, and we accept many of the principles upon which your organisations are based. I have a question for Sir Paul—
Sir Paul Kenny: Paul is fine.
James Cartlidge
Okay. That is what it says.
In relation to the police, we heard this morning from a senior police officer who was referring to the ability to identify someone when a strike happens and how useful it would be for them if it were easier to identify the lead—the person co-ordinating it. I would be interested in your comments on that.
Sir Paul Kenny: I do not know how many picket lines you have been on—
James Cartlidge
Not one as an MP, I must admit.
Sir Paul Kenny: I would be happy to take you.
Look, I have been on a few, for obvious reasons—it is the nature of the job. Before I was a union official, I exercised my right to go on strike. My experience is that where picket lines are correctly policed, they are policed by consent. That normally always means that the officers strike up a relationship over a long period of time. They will introduce themselves and ask exactly who the union official is and who the steward is. The union officials normally wear some identification, but there is a fairly limited number of people. It is not 500 people in the road—the police would deal with that.
The idea that you need to supply lists of names and addresses is a real problem for us, and I will tell you again why. We know, thanks to the Scottish Affairs Committee, that thousands of working people were blacklisted—some for little more than attending a union meeting. There is nothing in the Bill about that. I see nothing that says there are protections and penalties. It is not unnatural for us to say that you have the police, who police by consent, and we support them in that. They strike up relationships with people almost every day—you might hear about the odd occasion here or there. I think that relationship is a good, professional one. Moving that on, so the police take names, keep registers and identify individuals who have attended, leads it into another area that we have incredible mistrust about.
I do not know what the police’s official reaction is, but I would have thought that this is not something they particularly like. I know what you said about one bit of evidence, but I am not certain that that is the view of all policemen.
Dave Prentis: Could I just take up the point about thresholds? We are not just talking about simple thresholds; we are talking about a second threshold in public services. We have no knowledge of which areas will be covered—it is very, very vague. The second threshold means a negation of democracy. If you reach a 50% threshold in, say, a health ballot, 80% of the members have got to vote for action, not a simple majority. It will be impossible to achieve. You are denying the right of public service workers under national agreements to use industrial action as a very final resort. That is how far it is going. You have to realise the unintended consequences of the double threshold—it is not one, it is two. It will bring to an end the right of millions of workers in public services to take action. It will never be achieved. You should be aware of that.
It is a very difficult area for us. We want to increase participation—we know that we have strength the more people participate—but you do not do it in that draconian way, because it will just lead to unofficial action and a breakdown in industrial relations in our public services. You will regret it.
Dr Lisa Cameron (East Kilbride, Strathaven and Lesmahagow) (SNP)
Q 383 What are your opinions on the use of agency workers? What effect could that have on public safety and, where you represent healthcare workers, patient safety?
Frances O'Grady: We have very good relations and agreements with agencies and the federation representing agencies in this country. We have always worked very closely on the fair principles of employers needing flexibility to cover peaks and troughs in production, or staff absences, and doing that on the basis of equal treatment within the framework of the union agreement. This proposal is obviously quite different. We are potentially talking about employers having the right to replace wholesale workers who have democratically voted to go on strike with, potentially, untrained and inexperienced agency workers.
As we know, labour providers source from all over Europe, so is the idea that workers would be bussed in, perhaps from another country, perhaps not knowing what they are being bussed in to do, and be put in the invidious position of being asked to cross a picket line? Many employers, including the industry federation, have said publicly, very clearly, that it is absolutely wrong-headed to put agency workers in the middle of difficult disputes. It is not something we have seen in this country for 40 years or more, and frankly it is either naive or positively dangerous to deliberately seek to undermine legitimately decided and democratically voted on strikes by the use of agency labour.
Dave Prentis: It is a very final resort when a public service worker or a health worker takes industrial action. Last year was the first time in 34 years that our members have taken action over pay, and it was to achieve the Government’s 1% pay award, which the Secretary of State had denied the workers, but we reached written agreements to provide cover. We provided written agreements—we signed them with the other unions involved—on ambulance workers to make sure that ambulances were there, all ready to go in an emergency. We reached written agreements for cover on wards. Sometimes, they have better cover than they do at times when they have staff absences because they want to ensure that the critical wards are covered. There is no need for agencies to be brought in.
With the change in the thresholds and the idea of agency workers—even Margaret Thatcher did not propose this. The idea of using agency workers, combined with all the other restrictions on industrial action, is punitive. Somebody wants to attack trade unions, but they are basing it on 1980s values, and we have moved on. The Bill will not in any way affect the productivity of the country, which we should be looking at—whether competition in Britain is good enough to take on the rest of the world. We are just going to end up fighting with each other, when we should be working together to ensure that workers benefit, the organisations they work for benefit and, in our case, patients benefit.
Nusrat Ghani (Wealden) (Con)
Q 384 To continue on agency workers, we took evidence earlier from Mr Jon Skewes from the Royal College of Midwives. He mentioned how potentially disruptive it could be if midwives were to go on strike. There are two issues: the fact that it costs so much to bring in agency staff, and the need to ensure that staff have the right skills to support mums and babies. If midwives were to go on strike, it would put at risk pregnant mums and their babies. Are you saying you would not want any agency staff available at that unit if a mum was going into labour? Would you not then allow agency staff to come in to work, to help those mums and babies?
Dave Prentis: I heard Jon’s evidence, and he said very clearly to you that they put in far more workers—midwives—than they have brought out in demonstrations.
Nusrat Ghani
Q 385 I am just asking as a point of principle, because Ms O’Grady said she did not want to see any agency staff. In this sector, would you not want to see any agency staff covering the shifts of striking midwives?
Frances O'Grady: You are being completely disingenuous. As you may well be aware—perhaps you are not—unions have long-standing voluntary agreements with employers in emergency services to ensure that life and limb are not put in danger during a strike.
Nusrat Ghani
Q 386 So agency staff will be brought in.
Frances O'Grady: The agreements are between the employers and the unions. I refer you to the NHS employers that have written to Ministers saying they are concerned that this Bill, its tone and the aggressive approach taken by it are jeopardising the good, long-standing social partnership arrangements we have in health and many other public services.
Nusrat Ghani
Q 387 I just want to establish whether agency staff would be acceptable in this situation, if nobody else was available.
Dave Prentis: I have never known a time when we have taken action in health and an agency would be needed, because we provide the full-time staff to stay in. We give them a dispensation, and we reach agreements with management on the levels of staffing they think they need to run those services. On many occasions, we have more staff in than are in on a normal Saturday or Sunday.
Sir Paul Kenny: Do you honestly think that a midwife looking after a mother would walk out—
Nusrat Ghani
Q 388 No, I do not. I was just asking because there was a huge discussion about agency staff. I want to know where the principle would stop and start.
Sir Paul Kenny: Yes, but you use the most emotive issue.
Frances O'Grady: I was speaking to a midwife called Natalie who went on strike because of the rejection of the 1% offer. They made sure that no mother or baby lost out. [Interruption.]
The Chair
Order. When the Chair calls for order, you will please desist. Members are asking questions. We want replies, and we do not do it as a collective; we do it individually, through the Chair. That is normal behaviour in this place.
Nusrat Ghani
Q 389 You represent a large proportion of the working people in our communities and our constituencies. We heard some damning evidence this morning about what happens to people who choose not to go on strike. We heard from the London fire brigade about how difficult it is for people who choose not to go on strike to get into their fire stations and carry on with their duties, and how they are possibly putting themselves at risk by continuing to go into work.
We also heard evidence from SITA. In its written evidence, it told us that non-striking workers during a strike in Doncaster in 2011 had been subject to “sabotage of private property”. Its evidence goes on to say that
“strikers visited the homes of workers, slashing car tyres and throwing paint stripper over a car. The Working Men’s Club used by a non-striker was contacted by a striker…who threatened the steward of the club that if they allowed him to use the bar, the club would be vandalised. The club barred the non-striker.”
How are you able to represent your non-striking union members and other workers? Who is supporting them?
Len McCluskey: That is an extraordinary thing for you to put forward.
Nusrat Ghani
It is not for me to put forward; it was evidence given by witnesses.
Len McCluskey: Fine, and I am going to answer it. There are current laws to deal with any action of that nature, which is criminal. You have put forward a specific incident that suggests striking workers are engaged in criminal activity. The police will deal with that when it is brought to their attention. If you asking whether I support that type of criminal behaviour, no, I do not. The police have sufficient laws to deal with those issues. There is certainly no need to introduce more laws, and I will not repeat the comments that my colleagues have made about the nature of those laws. I will just remind you of what I said right at the beginning: a threat to the cohesive nature of the communities we live in is something you need to take on board. Laws already exist to deal with all of that type—
Nusrat Ghani
Q 390 The 2010 dispute was discussed earlier on. This evidence from 2011 is that there are people who wish to go to work but feel intimidated.
Len McCluskey: What has that got to do with the Bill? If they feel intimidated and there are incidents of vandalism, I assume they bring that to the attention of the authorities, who will deal with it. It is certainly nothing to do with trade unionism or the right to strike: the right to exercise our democratic views to an employer. It has really got nothing to do with us and nothing to do with the Bill.
Sir Paul Kenny: I am not privy to that particular evidence that was given to you—I would love to see it—but it seems to be four or five years old and I would have thought in those four or five years that the criminal acts that you seem to be describing here would have been reported to the police. I wonder what action the police took, because it sounds like individuals were known. Forgive me; I am not trying to be difficult here, but I am wondering where this fits in with our discussion.
Nusrat Ghani
Q 391 Who represents the workers who want to continue going to work, especially if only a minority of union workers are calling for the strike in the first place?
Sir Paul Kenny: If that is the question, that is dead easy to answer. I do not know why it had to be prefaced with stuff from four or five years ago. If you say what happens to people in the union who decide, even if they voted in a ballot, to go to work, they go to work. There are already adequate laws covering no victimisation for those individuals. There is nothing in the Bill that adds to that. Sorry, that already exists. Truthfully, I wonder how much knowledge there is in existence about the rules governing trade union bodies. That is already covered. They have a right. If they go to work, they go to work.
Nusrat Ghani
Q 392 They are obviously finding it difficult to go to work in these circumstances.
Len McCluskey: It is not a question about it being difficult to go to work. The current legislation allows people to go in and out of work. It allows contractors to deliver in and out of work. It allows the striking workers to exercise their right to explain why they are on strike.
If you are talking about evidence-based, I know that my own union was accused of thuggery and intimidation in the INEOS dispute. That complaint was brought by a Conservative MP—a woman whose name I forget at the moment. The result of that was that Police Scotland and the Hampshire police force said there was no case to answer. There was no criminal activity whatever. There was nothing abusive or intimidatory. If you read the headlines in the daily newspapers, you would think the complete opposite, so I ask you to understand the nature of a dispute and the manner in which trade unions try to organise in a disciplined way, because the one thing that we want when our members are out on strike is to get them back into work. We want a negotiated settlement. And trust me, this Bill will make it more difficult to achieve those types of aims.
Ian Mearns
Q 393 Professor Keith Ewing talked of his concerns about the potential future role and appointment of certification officers. Do you have any particular concerns about that?
Len McCluskey: I can answer that question, because we have huge concerns. Again, I am addressing Conservative colleagues on this. The first question I would ask is: what problems are supposed to be addressed by this element on the certification officer? What current problems exist? The certification officer is currently seen as an independent individual, and the current person there is highly respected by both sides of industry. It will no longer be independent.
There are no criteria about who can be the certification officer, and the most damning issue here is that anyone can complain. Any member of the public can complain to the certification officer, who would have the power to go into a union, disrupt its business and crawl all over its business in relation to how it operates. That is in stark contrast to what happens with individuals who are seeking redress at an industrial tribunal. They have to pay £1,200 up front and can be accused of vexatious behaviour. The measure would cause unnecessary upheaval in trade unions.
The slap in the face on top of it is that our members have to pay for it. Can you imagine the number of people who want to complain about Unite or any other union? We would have the certification officer, or whoever they determine, constantly working in our building, clawing over issues, with our members’ money paying for it. The big question that needs to be answered is, “What are the problems?” Why is this bit about the certification officer in the Bill? I have never heard any criticism of the certification officer’s current methods.
Frances O’Grady: With the Chair’s agreement, I am happy to add to that. As Len has pointed out, I suspect that these are some of the aspects of the Bill that David Davis was suggesting were more appropriate to Franco’s Spain than a modern democracy such as Britain. Many people are extremely worried about the idea that a certification officer can respond to complaints by employers, have the power to seize documents from union offices, impose fines and so on. The idea that the CO could, in real time, send inspectors down to picket lines does not feel like a good use of our money, given that we are also expected to pay for the privilege. It is taking industrial relations into territory that would be poisonous for both employers and unions.
Perhaps we also need to make it clear for the record that the total number of disputes that took place in Britain last year was just over 150, with a tiny proportion of days lost as a result. You have to come back to asking, “What is the problem that we are trying to crack here?” As a Financial Times leader pointed out, it smacks of the Government crossing a road to pick a fight.
Dave Prentis: Can I supplement that? There were 160 disputes and only 640 ballots—four times the number of disputes—because we negotiated settlements before announcing a ballot. The ballots are not the important thing. It is about the settlements that we reached that then led to less industrial action.
There are three major Acts of Parliament covering what we do. We are the most regulated sector within the economy, if not the western world. This merely adds to that over-regulation. It is an over-burden for which there is no need. It shows the views of the people who are putting the Bill forward. There is absolutely no need for the certification officer to have additional roles. We are well policed by them already, if not too well.
Sir Paul Kenny: I am yet to have any understanding of the justification for the certification officer’s additional powers. The powers are already wide-ranging, and I do not understand the justification, other than to shackle or restrict the ability of unions to do their job. I thought that this Government were about deregulation, but it appears that they are until it comes to unions, which they want to regulate through the teeth.
The Chair
Mr McCluskey, when Nusrat Ghani asked you a question a bit earlier on, you referred to a case that she raised and you alluded to evidence of the case and that there was no action by the police, who noted that no action was needed. Could you send the Committee a note about that? It would be quite useful to Members on both sides when they come to judge the evidence that has been given.
Len McCluskey: Yes.
Seema Kennedy
Q 394 I think it was you, Mr Prentis, who mentioned productivity earlier on. I accept that your organisations often prevent strikes, but they do happen. Do you accept that when millions of people are out of the workplace because of a strike or when a strike is threatened—we have heard a lot about the threat of strikes being disruptive to lives and businesses—it will inevitably have an impact on productivity?
Dave Prentis: It will inevitably have an impact, otherwise why would the workers be doing it? The issue is when you take the action. You take it as a final resort. We represent low-paid women, nearly 1 million of them, and they cannot afford to miss a day’s pay. It must take something drastically wrong and unfair. They are not motivated by aggrandisement. Something happening to them that is unfair will motivate a low-paid woman public service worker to vote for industrial action.
We cannot just talk about the effect on the public and ignore the effect on the individual striker, because they are doing it for a real reason: they feel very aggrieved about how they have been treated. They have to have the ability to seek a settlement. If we cannot get settlements, the right for workers to withdraw their labour is obviously a final resort that is allowed in the ILO conventions, which Frances has been talking about. It is impossible to take industrial action that does not have some effect on people, otherwise why take it?
If you are talking about productivity, productivity is everything that happens during the course of a year. For our members, on average, a member will take action every 15 years, yet we are obsessing over productivity. The issue with productivity is getting more skilled, higher-paid workers within our environments and ensuring that people are well treated and can contribute. It is about having the investment to increase productivity—that is not necessarily coming through—and having a fairer society where people want to contribute. You cannot connect productivity with the small number of days that are lost.
Seema Kennedy
Q 395 Can I just bring it back to women? You say that you represent a lot of women who are low-paid.
Dave Prentis: A million.
Seema Kennedy
Q 396 Many of whom will be mothers or have other caring responsibilities, perhaps for other family members. In the TUC submission, where you are talking about the notice period, you say that it will needlessly delay the start of industrial action. Do you not recognise that for those women, they might need those 14 days to arrange extra care for their dependants? Extending the period from seven days to 14 days might be useful for them, because of the disruption.
Frances O'Grady: I am not aware that the Bill is only targeting the 14-day notice period in areas where mothers will be affected by the strike. It is a false prospectus. Let us be clear about this: the extension of the notice period is designed to reduce momentum and participation in the strike and weaken the union’s hand.
With your agreement, I will make a very small point on productivity, on which I can give you some hard evidence. The number of days lost through industrial action during the past year adds up to just one half of one ten-thousandth of a percent of all working days. To put that in perspective, the number of days lost through issues around health, safety and wellbeing is 450 times that—
Seema Kennedy
I would not dispute that, but we want to increase productivity in everything.
The Chair
Order.
Frances O'Grady: I just wanted to make the point that our union representatives play an absolutely critical role in delivering higher productivity in the workplace, including through health and safety. A number of those strikes are directly relevant to issues, such as health and safety, that in the long run are important for business and the economy, as well as for working people. Again, I think you have to understand that trade union activity and strength actually improves Britain’s productivity by creating safer, healthier and better trained workforces.
The Chair
I wonder, Ms O’Grady, whether you can send us the stats you have been referring to. If you can send it to the members of the Committee, we will distribute it on either side.
Chris Stephens
Q 397 I think all four of you have an interest in public services. Obviously, you will be aware, as was alluded to at the start, that not all UK employers, including the devolved Administrations, support the Bill and the impacts it will have. Can I ask each of you whether you believe that all public sector employers in the UK should either provide their consent to parts or all of the Bill or get opt-outs to parts or all of the Bill?
Len McCluskey: First, it is a serious issue that, again, I have raised publicly and Conservative members of this Committee will want to take it on board. At the general election, the Conservative party ran part of its campaign on English votes for English laws. The reality that we find with this Bill currently is that the Scottish Parliament has indicated that it will not implement the Bill; Stormont has indicated that it will not implement the Bill; and the Welsh Assembly voted yesterday not to implement this Bill. There is a real danger that English workers will be the worst treated workers not only in the whole of Europe, but indeed in the British Isles themselves. That is what is deeply divisive. The direct answer to your question is, yes, we know that there are local authorities and employers right throughout the British Isles who are indicating that they will not implement this measure, and certainly the devolved powers should have that view.
I will finish on a quick point, which is again for colleagues on the Conservative side. I deal with every single major manufacturing company within our nations—blue chip companies. Not a single CEO of any of those companies is in favour of this Bill, and I ask that that is taken seriously on board. So, yes, I am in favour of an independent approach to this.
Sir Paul Kenny: I will be quick. I think the consent issue is quite clear.
Just dealing with the issue about check-off, as it is commonly called, effectively it will still remain lawful. If the wagons roll on for a deduction to be made to just about any organisation—to the bowling club, to Uncle Ben’s shop, to any appeal whatsoever—despite all the arguments about how difficult it is and costly, it seems the only organisations that will not be allowed to use that facility are trade unions. I am sort of getting the drift that someone has got it in for me, you know? Basically, when you look at it like that, you cannot justify that argument.
Also, in terms of facilities, there are statistics coming out of the walls about the job that people do in saving so much in employers’ time: stopping stuff going through to litigation, dealing with health and safety issues and dealing with grievances. You know, kettles have spouts for a reason and you are trying to put a sock in it, and that will not do. That is not the way to deal with genuine grievances and disputes. So it is one of those occasions when I am beginning to think that devolution is a pretty good idea.
Dave Prentis: I will concentrate on check-off and sign-off, as I did at the beginning, and I will remind you that we have 7,242 employers who operate check-off systems and with whom we have agreements on time off. Not a single one of those employers has said anything in relation to this Bill that would lead you to believe that they want this blanket ending of check-off arrangements. In fact, nobody was asked before the Bill was put together. The NHS employers were not asked; the local government employers were not asked; individual employers were not asked. It takes away all these ideas of localism and the idea that employers should have a right to talk to trade unions or not, as they feel, and reach agreements that they wish to have.
The Bill brings in draconian central planning, and all the discussion has been not just about devolution within the nations of Britain—Scotland, Wales and Northern Ireland—but also in English regions and the combined authorities. Combined authorities will be allowed to do everything, but what will be taken away from them is the right to talk to their staff trade unions about the arrangements that they want in place, either for check-off or not for check-off.
At the moment, any employer can withdraw check-off; it is in their gift. There is nothing in law that prevents them from doing that, and it would be virtually impossible to take industrial action to stop them doing it. And some employers do take us off check-off. Wandsworth did; one of the new private probation companies has just done it; and we deal with it as a local issue, because it is an issue between us and that employer, and maybe we will reach compromises. But the thing I will say, which seems to have been forgotten completely, is that we pay for these check-off arrangements. They are not the gift of the employer; it is not costing the taxpayer money.
I will give you examples: Fife Council and East Lancashire Hospitals NHS Trust. Both of them cost us at 5% for collecting it, and it does not cost them anything like 5%. Bradford City Council charges £38,000—that is the cost of running our social workers. You end check-off and you are talking away one and a half social workers in Bradford. Derbyshire County Council charges around £5,000 a quarter. Others will hold on to the money for three months, put it in the bank account, get interest on it—it is small at the moment, but it is usually fairly big—and then give us the money and they make arrangements from it.
What I will say is I do not believe that any taxpayer should pay for this arrangement. Where we do have agreements, we are more than willing to pay a commercial amount of money to have these arrangements stay in place. Taxpayers should not pay, but neither should central Government issue a diktat saying that employers are doing something unlawful in reaching an agreement with their local union reps about the collection from source of union dues when there are so many different areas where the member of staff can have deductions from salary, including MPs and councillors, which are denied to our members for reasons that we do not understand.
The Chair
Mr Prentis, can you also get the detail of that and send it to the Committee? We will distribute it. It has been a very useful piece of information and I think both sides would welcome it.
Dave Prentis: I am saying categorically here that we believe that taxpayers should not fund this arrangement. If that is the issue, we will make sure that we have stronger commercial arrangements.
The Chair
I well understand that. It is not your view; it is the evidence that you have come up with that we need the detail of for consideration. We have got eight minutes left and we have still got four questioners to ask their questions and get a reply, so could we be more succinct on both sides—the interviewees and the Members?
Victoria Prentis
Q 398 I was a public sector worker myself for 17 years, and although you may feel that we have got it in for you on this side of the Committee, I learnt a certain amount about industrial relations in that time and I am fully aware that we are very lucky to have giants of negotiation strategy in front of us, helping us with this Bill.
Mr McCluskey, in a way that does not surprise me at all, has put forward his position in writing and he has given his position is on thresholds: 50% if he gets e-balloting—[Interruption.] Sorry, workplace balloting. Do the other three of you share that position?
Dave Prentis: I do not believe that there is a need for thresholds. If the aim is to increase participation—that was the pretence behind it—I believe in moving to e-balloting, but, more than that, workplace balloting. Do not make the assumption that all of our members have got access to computers. Our refuse collectors do not sit at a computer all day; they are out on the streets, collecting our rubbish, as so many other public service workers are.
We do want to bring in e-balloting. We do want a safe computer in the workplace, but we also want workplace balloting. You may have been a member of my union in the past, but I come from a union that, before our merger in ’93, we always had secret postal ballots that went to the workplace and the turnout was 70%. As soon as Thatcher’s law came in that said that they had got to go to home addresses, it dropped to 22%.
Victoria Prentis
I will take that as a no.
Frances O'Grady: The TUC is clear, as I said before, that it is actually the ILO that the Government need to answer to. The real issue here that all good democrats should be focused on is how we improve participation in ballots across the board.
Victoria Prentis
I will take that as a no, too.
Frances O'Grady: It is a yes to modernising methods of balloting.
Victoria Prentis
But no to thresholds. Sir Paul?
Sir Paul Kenny: I am a negotiator.
Victoria Prentis
I thought you might be.
Sir Paul Kenny: My position is that no vote should not count, but that is a principled position I can hold. What Len McCluskey has done is put down a challenge: if people are serious about improving participation, come and talk. That may mean people have to move their principled positions, but I always understood that the end result was to find something workable and real. I do not know where you are going to put me down.
Victoria Prentis
I am going to put you with Mr McCluskey in my head.
Dave Prentis: It is a no to the two thresholds.
Jessica Morden (Newport East) (Lab)
Q 399 The ILO definition of public services talks about “essential”. The Bill talks about “important”. Are you clear from the Government so far how important public services will be defined and, crucially, which workers will be covered?
Frances O'Grady: No, and I do not think the Government are clear either. In particular, the proposal that so-called ancillary roles could be included is extremely interesting but has yet to be defined. It makes it very difficult to have an intelligent discussion about this aspect of the Bill when we do not even know what jobs and functions could be covered.
To give a practical example, if a call centre is providing public services as part of its work and for parts of those call centre workers’ jobs, but it is based in the private sector, does it fall under the 50% threshold or the 40% threshold? Quite genuinely, how are unions supposed to run a lawful ballot when it is simply not clear how that would work in the real world? So far, we have not had an answer to those questions. It could be cleaners, call centre workers, ancillary staff—all sorts of job could be covered—but I am not sure how the Government’s proposals are supposed to work in the private sector that is providing public services.
Dave Prentis: It will be a nightmare, and it will be a goldmine for solicitors because for every work group we try to define, it will be fought out in the courts. None of us want that, surely. It is so ambiguous and so badly worded that it is difficult to find out how essential these people who are caught are. At the moment, it catches teaching assistants, who work in our schools at different levels, may only work at term time and, in many cases, are abused in the way they are treated, yet they may find themselves caught by this idea of important public services. It is ill defined and will lead to litigation going on for many, many months around disputes. Instead of trying to solve the disputes, we will be involved in fighting out in the courts whether or not we should be balloting, or whether we need an 80% majority or half of the members actually voting. It is going to be an absolute nightmare for industrial relations in public services.
Frances O'Grady: What is clear is that the Government are going way beyond any international definition of an essential service. International bodies are very clear that it is not enough to say you are further restricting strike action purely because of—however bad it is, however inconvenient and however disruptive to other businesses, that in itself cannot constitute a reason for further restrictions on the right to strike in certain sectors. In any case, the Government’s definition—carefully worded, I think—of important services goes way beyond any international definition of “essential”.
The Chair
We are moving into an area that we should be wrapping up. We should finish in about one minute, but I have leeway of up to five minutes. I will call Julie Elliott as the final speaker, but before I do, we may have a brief response from Stephen Doughty.
Stephen Doughty
Q 400 Frances, you talked about the international context. We heard factual comparisons from Amnesty and Liberty. Obviously, it was David Davis who compared parts of the Bill to Franco’s Spain. If the Bill was enacted as it stands, how would we compare internationally? Which countries would we find ourselves alongside?
Frances O'Grady: I always avoid naming particular countries because I am hopeful of persuading the Government that we should not be in that league. We already have what is widely recognised as one of the most restrictive legal frameworks on unions in developed western industrial democracies.
Stephen Doughty
Q 401 But it would put us somewhere near the bottom.
Frances O'Grady: This would take us further down that very unsavoury league.
The Chair
I am sure that you can write to us on that subject, Ms O’Grady. It would be helpful.
Julie Elliott (Sunderland Central) (Lab)
Q 402 Paul and Len, we took verbal evidence this morning from David Palmer-Jones, the chief executive of SITA UK. He made what I regard as very serious allegations about officers from GMB, Unite and UCATT. Obviously, the latter are not present, so I cannot put the allegations to them. He was talking about intimidation at what he said was picketing, but, upon further questioning, turned out to be demonstrations in Teesside relating to issues with SITA. He said that officials of your unions tacitly approved of the tactics deployed—that is, intimidation—and were actively supporting them. I wanted to give you the opportunity to share your thoughts on that.
Sir Paul Kenny: I do not know what he said to you, but if he wants to write to me, I am happy to look into those concerns. I can tell you that Teesside is a bit of a flashpoint because it involves a company that is importing labour and paying them below the market rate, denying jobs to local people. That is always a difficult situation and there are protests about that. They come from a wide variety of people, including us. I checked yesterday what the situation was—I try to stay in touch with what I think are difficult areas—and I was told that there had been absolutely no arrests and that relations with the police were okay, because I ask those questions. I was told that if ever there is an issue, the inspector talks to whoever the group are, exactly as I described earlier, and if there are any concerns, they are relayed and then dealt with by the people on the ground.
I realise that that has been said to you and I appreciate the fact that you have put it to me. I have absolutely no knowledge of it. I would love to see some substantive evidence of it, and if there was some, we would deal with it. My latest check—presumably, the police can confirm this—is that there has not been any evidence. If there was any sort of behaviour like this, I expect the police would step in. They are there when they are needed, but relationships are pretty good, as I understand it. The dispute has been on for a while now, and to my knowledge not a single person has been charged with any sort of behaviour like this at all.
Forgive me if I am a bit sceptical of people coming along and saying, “At the bottom of the garden there’s lots of fairies.” There may be, but I have not seen them. I would like to see them before I start to legislate against them.
Len McCluskey: Like Paul, I try to keep abreast of sensitive issues, and this is a really sensitive one. It cuts to the very cohesion I was talking about in our society, because people are being brought in—migrant workers—and being asked to work at way below the national rates negotiated with employers. The company itself has a lot to answer for.
I checked recently on the newsreels, and, talking about this dispute, a spokesman for the police said that
“officers then spoke with members of the group and facilitated a peaceful protest while working to minimise disruption to residents and businesses in the area.”
That sums up the way we would expect to conduct our business.
The Chair
Thank you. That brings us to the end of the evidence session. We are grateful for your attendance. You are obviously very busy people, representing an awful lot of people, so we are grateful that you did not send anyone else but came yourself.
Sir Paul Kenny: I beg your pardon, but if I could make one last point, this is it. We spent about three years of parliamentary time discussing whether we were going to charge for plastic bags; we have spent weeks talking about these major changes. None of us knows the implications of many of the questions you have asked. It seems that carrier bags are more important than the future of industrial relations and rights of workers in this country.
The Chair
Thank you very much.
Examination of Witnesses
Nick Boles MP and Matthew Hancock MP gave evidence.
The Chair
Order. We now come to our final session for today, in which we will hear oral evidence from the Department for Business, Innovation and Skills and the Cabinet Office. This session will last until about 5 o’clock. I know that you both know the drill very well because you have done Bills before. Minister, you have been here throughout, which is not usual for some Ministers. We are going to try to get through this as best we can, and the best way to do that is to be as succinct as possible. We recognise that you want to put on record various stuff that you have got from the Department, but please leave us enough time, because the whole purpose of this is to try to get evidence from you and ask you questions. Without further ado, Mr Boles, would you like to start?
Nick Boles
Thank you, Sir Alan. It is a pleasure to be in the hot seat now, rather than in the stands. I am going to give a brief opening statement, if that is okay—I will try to be very brief—on the main measures in the Bill, and then my colleague and friend Mr Hancock will address the facility time and check-off proposals.
We had what I thought was an absolutely gripping evidence session earlier with the four giants of the trade union movement, and we heard some pretty lurid language. The Bill was described as an ideological Eton mess, and as something straight out of the Norman Tebbit playbook. I think we are all aware of, and quite enjoying, the Labour party’s embrace of 1980s retro, which seems to have gripped them since the election. I would love to be able to live up to the caricature that has been painted, and I would love to have my name put, if only in very small type, at the bottom of a Bill that people were talking about in 100 years’ time as one of the most radical and dramatic Bills to change the laws of our country, but I am afraid that I have bad news for the Committee. The bloodcurdling rhetoric, although enjoyable and entertaining, is entirely out of place. The boring reality is that the proposals are modest. They are marginal adjustments to the rules governing strikes and members’ financial contributions. In two years’ time, I fear, this Bill and my role in it will be almost entirely forgotten, except in the privacy of my own bedroom.
I will quickly go through the main measures in the Bill, and then I am happy to take questions. I understand that the strike threshold proposal causes a lot of upset and argument, but the fundamental truth is that most strikes over the past few years would have met the threshold. Members of the Committee made reference to the fact that we did not get an absolutely glowing review from the Regulatory Policy Committee for the impact assessments on the first consultation. I regret that they were done in haste, but it is entirely my responsibility. The main mistake that we made, as the committee pointed out to us, was to make a crude assumption about the effect of the thresholds on the number of future strikes, because in that assessment, rather stupidly, we said that we thought that any strike that would not have passed the threshold in the past clearly would not pass it in future. Well, of course that is not going to happen. What will happen is that unions, as you have heard, will make great efforts to ensure that the thresholds are met. In most cases, they are already met. I predict to the Committee that the thresholds will produce a small decrease in the number of strikes. Critically, however, there will be a large increase in the perceived legitimacy and validity of strikes among the public affected by them, which is entirely desirable.
We had a discussion on notice periods, and members of the Committee made a good argument for why it is surely not unreasonable to give people two weeks’ notice, rather than a week, of something that could cause them to have to take a day off work or make alternative childcare arrangements.
There has not been much discussion on time limits for ballots, but it is an important measure. Currently, and in the recent past, strikes have taken place in the public sector on ballots that were passed two or three years previously. Frankly, many of the people who voted may no longer be working in the institutions where the strikes are taking place and the issues are surely not at the front of people’s minds. The four-month time limit is therefore reasonable.
There has been much discussion on agency workers, so I simply point out to the Committee that withdrawing, as we propose, the prohibition on the use of agency workers in a strike does not require any agency worker to take up an offer of employment and does not require any employer to seek agency workers in the first place. We heard good arguments about levels of training and tensions with permanent staff. We also heard good arguments as to why, both for individual workers and for employers, it was unlikely to be something that would solve any problems. We simply believe that the option should exist.
Finally, on the much-debated rules regarding the political fund, we take a simple position, which is that if someone wants to support a political party, it is not too much to ask them to tick a box every five years that says, “Yes, I want to support political activity and a political party.” If the political party believes in its arguments as passionately as members of this Committee do, I have absolutely no doubt that it will be able to persuade everyone currently contributing to political funds to carry on doing so.
Matthew Hancock: I am not sure that I can match my colleague for rhetoric, but I want briefly to set out the principles behind the two changes that are the Cabinet Office’s responsibility for policy purposes and therefore mine. First, on facility time, clause 12 simply makes the change that public sector employers need to publish information on the amount of facility time, which is similar to a change that we made in the civil service that saved £52 million in the last Parliament. The first step before making any savings, however, was to publish the information, because we currently do not know how much taxpayer money is spent on facility time. Clause 13 contains a reserved power to be able to limit the facility time taken by union representatives to a percentage of working time, which is similar to the reasonable changes made in the civil service. A legal entitlement to facility time exists at the moment and we do not propose to change that in this Bill.
Secondly, check-off is a name for the relationship in which a trade union member, instead of paying their dues direct to the trade union, pays their dues through the employer taking the payment from the pay cheque before paying it to the trade union. I think it is reasonable that the trade union relationship, which is valuable in many cases, is one that is between an individual and their trade union. Often, one of the primary purposes of trade unions is to mediate on behalf of their members. It is old-fashioned to think that the payment from one to the other needs to be intermediated by the very employer with whom the trade union is often the interlocutor, on behalf of the member.
These are reasonable changes. We have made them in the civil service, and the Bill simply proposes to broaden the principles and apply them to the public sector as a whole.
The Chair
Thanks very much. It is true that when every Member of Parliament is elected, then takes the oath and signs the book, they become seasoned politicians. I ask Members on both sides of the Committee to direct their questions to the appropriate Minister, rather than the collective, otherwise we will get very few answers done.
Stephen Doughty
Q 403 We have heard some pretty interesting evidence during the course of these two sittings, and of course, on Second Reading and outside this House as well. We are in a situation where many Government witnesses could not appear to find reasons for the Bill, did not appear to have read or to understand parts of it, and certainly could not justify it. There have been passenger bodies who were not willing to comment on it; the police, who think parts of it are unworkable; the unions, who obviously do not want it; civil liberties organisations, who do not want it; legal experts, who do not want it and think it violates various conventions; and devolved Governments, who do not think they are going to give their legislative consent for significant parts of the Bill to go forward. So where was this dreamt up? Was it done by Minister Hancock? Was it in Minister Boles’s bedroom? Or was it the Chancellor? We seem to have a Bill without a purpose and without a need that appears to be largely unworkable. How was this dreamt up?
Nick Boles: Well, Mr Doughty, I am sure you remember—you were paying as close attention as I was—the evidence that was given by the Confederation of British Industry. The director general or secretary general—whatever he is called—John Cridland made it clear that it was a policy that the CBI had adopted five years ago and had been campaigning on for five years. We in the Conservative party think that the business community is important and should be listened to. You will also be aware that in the last five years, in which we were in government in coalition, there were a number of strikes—I must always emphasise that these are the great exception to strikes in general—that caused huge disruption to members of the public who have no alternative means of securing the service that the organisations offer.
Stephen Doughty
I—
Nick Boles: I am just going to finish, Mr Doughty. Those strikes cause great disruption to members of the public, and they did take place either on very old ballots, or on very old ballots that were also secured by a very low turnout. Therefore, we have put together these proposals, which we think the public support.
Stephen Doughty
Q 404 We have heard the myth of mass industrial action that the Government are presenting, when the facts simply do not bear that out. It is important that we use the latest evidence—
Nick Boles: Did you hear me say “mass industrial action”? I do not think I said that. I said it was very much a minority of industrial action.
Stephen Doughty
Q 405 Yes, but that is not the impression created by Ministers. In the media, we had Minister Hancock going out over the summer talking about—[Interruption.] I have here what Minister Hancock said over the summer. He was talking about having “hit squads” to deal with strikes. He said:
“We are ready to use the Cobra system if there are strikes. We are ready to respond”—
to a wave of industrial action. Talk about 1980s rhetoric—that is exactly what we are getting from Minister Hancock. Let me return to the facts. The Ministers should be familiar—
Matthew Hancock: Hold on.
Stephen Doughty
Q 406 Did you say those things, Minister?
Matthew Hancock: You are confusing the difference between headlines and what I said in that case.
Stephen Doughty
I have your exact quotes here, Minister.
Matthew Hancock: Hold on, because you have just accepted that you had moved away from the facts and are now having to return to them, and I look forward to that. There is one further thing that motivates some of the changes in this Bill, and I know it is not something that the Labour party cares much about.
Stephen Doughty
Q 407 Minister, did you say the things that were reported in the summer?
The Chair
Order.
Matthew Hancock: In the last Parliament, in the civil service, which is about a tenth of the public sector by headcount, the changes proposed in this Bill, which would be enabled as reserve powers in this Bill, saved over £50 million. I know that saving and looking after taxpayers’ money is something that different MPs care about more or less, but I think it is important—and I know it is important to the general public—that we run public services as effectively and efficiently as possible. Saving taxpayers’ money is important, and at the moment we do not know how much taxpayers’ money is spent.
Stephen Doughty
Q 408 Minister, we will come to the potential costs of the Bill in due course. Given that you are speaking about the public sector and that you wanted to return to facts, could you tell me how many working days were lost due to industrial action in the past six months, based on the latest figures from the Office for National Statistics? What proportion is that of the overall number of working days in the public sector?
Nick Boles: Sir Alan, you may remember, though of course you have not been chairing all the sessions, and other Committee members will certainly remember that, on the first day of evidence, we had a lively debate about the difference between direct impacts of days lost—we have always accepted and been very clear that the number of days lost is low, historically; that is very welcome—and the indirect impacts on people who have to completely reorganise their lives because the bus they use to get to work is not running or the school to which their children normally go of a morning is closed.
That is what we are focusing on, and we have been explicit: this is not trying to dramatically reduce the number of days lost to strikes. We have never said it is. We have acknowledged that the number of those days is low. We have said that we are trying to reduce the impact of strikes with low support on members of the public. Their days lost and their disruption is not measured by the ONS. I would love it to be measured by the ONS, though I suspect it might be quite challenging to capture those data. It is a real thing. You just have to ask the public what they think of our proposals, and they clearly support them.
Stephen Doughty
Q 409 So we are making a Bill based on evidence that the Minister admits does not exist. The British Chambers of Commerce and the Confederation of British Industry could not provide that evidence either. I have the facts: for the public administration, defence and social security sector, 145,400 working days were lost to strikes in the six months before August 2015, according to the latest ONS statistics. The total number of working days in a year is 393,580,000. The days lost to strikes are less than 1%; it is a tiny proportion.
Nick Boles: It will not come as a surprise to any member of the Committee that the Labour party is not interested in what the public think about the situations with which they are faced. This idea that everything important in life is captured in an ONS statistic is, frankly, perhaps what has led the Labour party to its current position. We take the view that when the public say they do not like being disrupted, they do not like having to miss work and they do not like having to look after their children mid-week because a strike that took place on 37% turnout closes the school their child goes to, we should pay attention. These proposals have been supported by a great majority of the public when tested in opinion polls, and we are doing the public’s bidding on this.
Stephen Doughty
Q 410 With respect, Minister, nobody likes being disrupted. We have heard repeatedly from witnesses that industrial action is always a last resort. We have also heard extensively about how unions put in extensive measures, particularly when there are health and safety issues and life and limb are at risk, to deal with that and ensure the public are not adversely affected. Whether you look at the TfL figures for the underground or the health and safety figures that Frances O’Grady mentioned, we know that the days lost or disrupted for citizens and customers in this country are vastly outnumbered by those lost due to causes other than industrial action. This is a huge sledgehammer to crack a relatively small nut.
I want to ask a few specific legal questions of Mr Boles and of Mr Hancock, given the impact on the areas he covers. We have heard clearly about the Bill’s potential conflict with the devolution settlement. We heard very clear evidence from both the Welsh and Scottish Governments that they would consider withholding legislative consent and that they believe this could lead to significant challenges. We have also heard about potential breaches of international conventions, let alone breaching principles of natural justice.
We talked about costs to the taxpayer. Given the cost to the taxpayer of, for example, the Supreme Court case that the Welsh Government were involved in with the UK Government over the Agricultural Wages Board, what estimate have the Law Officers made of the potential legal cost to the Government as a result of this legislation being challenged in its current form?
Nick Boles: I am glad to say the Law Officers have advised us that all the proposals in the Bill are entirely compatible with both devolution law and the European convention, so we are not anticipating legal costs to fight. If, of course, trade unions or others want to challenge, we will defend robustly our proposals, but we are absolutely satisfied that they abide by all the conventions that apply.
Stephen Doughty
Q 411 Do you plan to go back to them, given some of the evidence that has been presented and the very public positions of the Scottish and Welsh Governments?
Nick Boles: No, because, as I think you will remember, the representatives of the two Governments did accept, although grudgingly, that employment is currently a matter that is reserved to the UK Parliament, so it is entirely proper for us to make changes to employment rules and apply them across the United Kingdom. They might prefer it was otherwise, but they accepted that that is the current legal position.
The Chair
Ms O’Grady spoke on this matter and promised to provide written evidence to all Committee members, so I suspect it will come up again when line-by-line scrutiny gets under way.
Stephen Doughty
Q 412 On balloting, the Minister and other witnesses have referred extensively to the Speaker’s Commission on Digital Democracy in advancing an argument against the use of e-balloting that I think most members of the public would find absolutely nonsensical, given that if we want to increase participation, we should increase the methods by which people can participate. The evidence to the commission from the Open Rights Group, which I think influenced what the Minister has been saying, made it clear that it was based on a comparison between general election voting in polling stations and online voting. The evidence did not consider the current union context of postal ballots under the Trade Union and Labour Relations (Consolidation) Act 1992, so it is not relevant to the discussion of the Bill. Why does the Minister keep citing the Speaker’s Commission on Digital Democracy as evidence to stand in the way of e-balloting?
Nick Boles
I do not know why voting in a strike ballot is essentially different from voting in other elections. We have been very clear about our position and the Prime Minister has replied to Mr McCluskey’s letter to make it clear that, as I have said several times—I certainly said it in the wind-up on Second Reading—we do not have an in-principle objection to the exploration of alternative methods of voting, including e-balloting, but we have some practical concerns that were set out very well in the evidence from the Open Rights Group and also in other discussions about various forms of voter identity protection, voter fraud and the like. If those practical objections can be overcome, this question might well be revisited in future, but we are not currently satisfied that voting can be done safely online in these elections. That may well change.
Stephen Doughty
Q 413 Have you taken advice from the Electoral Reform Society? It advises that, in 2014 and 2015, the Nationwide building society, Yorkshire building society, the Co-operative Group, the British Medical Association, the Chartered Institute of Marketing, the Federation of Small Businesses and the Institute of Chartered Accountants in England and Wales—the list goes on and on—have all used these methods. Most members of the public listening to this debate will struggle to understand why the Government are not willing to come forward, have a sensible discussion about e-balloting and secure workplace balloting, to which I can see no objections whatever, and get to a solution.
Nick Boles
The hon. Gentleman has started that debate, Sir Alan, and I am sure that this is not the end of it. We will debate the different forms of voting and the practical objections, or otherwise, to them. All we are saying are that our concerns, which we have not just made up—they are shared by others, independent of Government, and were elaborated upon in the Speaker’s commission, which met only last year—have to be overcome. Frankly, internal elections in organisations to choose office-holders have to meet a much lower test than elections that involve the withdrawal of labour, the closure of services and great disruption to the public, so we are right to attach a higher level of demand—
Stephen Doughty
But it is fine for the annual general meetings of major financial organisations.
The Chair
I think we have tested this enough. We will move on, because we have very little time remaining and there are Members on both sides who want to ask questions. These issues will be tested in Committee when we reach that part of the Bill and more evidence is presented.
John Howell (Henley) (Con)
Q 414 It is clear from the evidence we have heard that a charge is being made that your proposals go against the International Labour Organisation. Would you like to deal with that now?
Nick Boles
There is no question but that representations have been made to the ILO, and within ILO discussions, that some of the restrictions that we propose could conflict with ILO provisions. What is clear is that the governing body of the ILO has never accepted those arguments. Having looked at all the governing body’s comments and decisions, we are entirely satisfied that nothing that we propose would conflict with them. Reference has been made to the European Economic and Social Committee; the truth is that we do not entirely accept its actions and status. It often says things that we and the governing body of the ILO do not agree with.
John Howell
Q 415 Like you, I listened intently to John Cridland’s evidence on Tuesday, but the intention of the questions we have been asking has not been to show that the Bill is a pro-business measure. What we have tried to show is the impact of that on parents, patients, carers and commuters. I think we have actually demonstrated that quite effectively. Would you like to comment on how that fits into the purpose of the Bill?
Nick Boles: That is absolutely right. We were always thinking, when drafting the Bill, about what to tell the public when a strike has happened to reassure them. The public support unions’ and individuals’ ability to strike, and they often would like to feel that they have the ability to avail themselves of that right in an extreme situation. There is absolutely no question about it; the public do not support something that withdraws people’s legitimate right to withdraw their labour in a case where they are being badly treated or a dispute that cannot be resolved otherwise. The public are frankly not very impressed when a strike happens that closes schools or bus services on an incredibly low turnout or a ballot that is several years old, and we are responding to that concern.
Chris Stephens
Q 416 Mr Boles, in relation to political funds, I want to outline my discomfort with dealing with this issue via the Trade Union Bill and not through other mechanisms in Parliament. Political funding should be dealt with across the board. I also point out to you that it is not just about those trade unions that fund the Labour party—those unions are in the minority, actually—but a trade union’s ability to campaign to change Government policies. The general secretary of the PCS made that point. Do you not think that it is inappropriate to deal with political funds only through this Bill and not to look at political funding arrangements across the board?
Nick Boles: I do not, and perhaps I could explain why. We have heard about the contributions that the political funds made to HOPE not hate. We certainly heard that on Second Reading. We have heard of other very worthwhile causes that are supported by unions’ political funds, but we live in a society, thank God, where there is an amazing proliferation of charities and campaign groups that are successfully and endlessly raising money from members of the public. They are lobbying for all sorts of changes in laws and practices here and around the world. It does not seem to me to be an unfair restriction or to be likely in any way to undermine the support for fantastic organisations, such as HOPE not hate, to say that if an individual wants to contribute part of their income towards an organisation, they should make an active choice to do so. That will not choke off any worthwhile campaigning activity in this country, where there is a huge array of it happening already.
Chris Stephens
Q 417 That breaches the Churchill convention, do you not agree? What you propose in the Bill breaches what has been referred to as the Churchill convention.
Nick Boles: Yes, there was a gentleman, a member of the Labour party, who gave extensive and fluent evidence earlier this morning, which we were all gripped by. He referred to a Churchill convention. Winston Churchill was a great man who said many great things, but not everything he said necessarily becomes a constitutional convention.
Chris Stephens
Q 418 Professor Ewing also referred to the Churchill convention.
Nick Boles: Yes, he would, wouldn’t he?
Chris Stephens
Q 419 Surely employers, when they are given notice of the ballot—currently, it is a seven-day period—at that point they know that there is a potential for industrial action, usually 45 days down the line. Why would you want to change the strike action period from seven days to 14?
Nick Boles: Again, this is a very revealing question and, I hope, a revealing answer. This is less about the employers than it is about the public. The public are not going to know, necessarily, because frankly we do not all read the papers or listen to the radio every day, when notice of a ballot has been given. What they will know is when a union that effectively controls a service on which they rely will have a strike. That is when the public, as colleagues of mine have adequately described, will know. Frankly, it could make a huge difference to the public if they had two weeks’ warning, rather than a week’s warning, to have to arrange emergency childcare because their school is going to close.
The Chair
I appeal to Members that we have 10 minutes or so left and five speakers. Could both Members and Ministers please be a bit more succinct?
Chris Stephens
Q 420 I will just ask Mr Hancock one question. Why have the devolved Administrations not been consulted or contacted by you in relation to facility time or check-off? Surely, they should have the right to maintain good industrial relations by keeping those things in place.
Matthew Hancock: The reason is that this area of policy is reserved, as confirmed by the Smith commission.
Chris Stephens
Q 421 Industrial relations is not reserved. That is the point. Surely, the Scottish and Welsh Governments have the right to make a policy decision on industrial relations in terms of check-off and facility time.
Matthew Hancock: This is a question of labour market policy. Labour market policy is reserved, as confirmed by Smith.
Chris Stephens
Q 422 So it is okay for a staff association to use check-off, but not a trade union?
Matthew Hancock: It is very different. There is a difference between deducting something from source when it is paid to an external and outside body compared with when it is part of a wider set of non-pecuniary remuneration such as a staff association or, indeed, a pension. These are two completely separate matters.
Chris Stephens
Q 423 Charities, credit unions—these all come off employees’ salaries. I am aware of many organisations that are external bodies that get check-off arrangements. Are you looking at them as well?
Matthew Hancock: No. It is perfectly reasonable. For instance, your pension, which is often deducted at source, is completely different. It is part of your non-cash benefits of being in work. If you look at each item on its merits, in a modern trade union system and a modern labour market—this is an area of labour market policy—it is perfectly reasonable and sensible that the relationship between a union and its members is just that and not one that is intermediated by the employer.
Chris Stephens
Q 424 I think the Minister needs to do more research on this.
The Chair
Let me appeal once more, finally, to Members. You only have a few minutes left and five Members want to ask questions. To be fair to each other, make it short and make the replies short, too.
Nusrat Ghani
Q 425 The Bill aims to modernise trade unions in just the way that work is modernised. Very few people now get a pay packet; the salary goes into your bank account. Surely, in that way, any worker should be able to choose whether they want to subscribe to a union or which union they want to subscribe to. That is why there needs to be a change in check-off.
Matthew Hancock: I agree with that and I will add something to it. It improves public protection because it ensures that it is an active choice of the member to be a member of the union, rather than getting the form in a pile of paperwork on day one, signing it off and the money always going out of your pay cheque before you receive it.
On check-off, I reassure Members about how sensible this change is by quoting the PCS union, which is the biggest union in the civil service. As of this morning, its website said:
“It’s quick and easy to sign up for direct debit—you can do it online in a couple of minutes… We are asking all members to do something very simple but very important—get ready to switch payment of your subs to direct debit. It only takes a few minutes”.
That demonstrates that this is not something that people should overreact to. Rather, it is a perfectly sensible change that has taken place largely already within the civil service. The PCS, which is the union that is mostly affected, confirms on its website that it is very simple and only takes a few minutes.
Jessica Morden
Q 426 In the previous session, we discussed the definition of important public services. From talking with Frances O’Grady, it seems that trade unions obviously are not clear who is going to be affected. Dave Prentis said he thought it was a “nightmare”, “ill defined” and would “lead to litigation”. Will we have a chance to debate these regulations and why have they had no consultation with you about what this will mean to them in practice?
Nick Boles: To correct you, we have had consultation, which is why it is not yet clear. The consultation only closed as the other consultations did. It is one of those funny things in government: you either get into trouble for not being specific, or you get into trouble for not having consulted. We wanted to say that we are clear about the sectors that this should apply to—health, education, transport, fire, nuclear decommissioning and border control. Then the question is, is it right that it should apply to anybody and everybody working within those sectors, whether in the private sectors, ancillary jobs or core jobs? Is there a practical way of narrowing down? We consulted on this point. We have had a lot of responses to the consultation. We will bring forward specific proposals before the legislation has received Royal Assent.
Jessica Morden
Q 427 It is just me, then. Why, then, have we not seen the draft regulations before now?
Nick Boles: Because we were waiting to analyse the very, very substantial response to the consultation that finished, I think, only at the beginning of September.
Edward Argar
Q 428 I have two very brief questions, the first of which is for the Minister for Skills. Minister, you have been very clear that you respect the right to strike, as we all do, and that this Bill does not, despite some alarmist suggestions, remove that right. The NASUWT actually acknowledged in its evidence that strikes would continue. Would it be a fair characterisation to say that it ensures that all the people and families currently at risk of having their daily and working lives significantly disrupted by strike action on a very low turnout will have a slightly more balanced set of protections to ensure that strikes have genuine support?
Nick Boles: Yes, exactly. The NASUWT should know well, because there have been strikes in the teaching profession on a very low turnout and on ancient ballots. Ultimately, that just really irritates people. They accept that they are going to be disrupted in a legitimate strike; they just want to know that it is at least recent and that enough people supported it.
Edward Argar
Q 429 I also have a quick question to the Minister for the Cabinet Office, reflecting on the comments that were attributed to him over the summer. My recollection—I hope he will correct me and clarify this—is that he was saying, quite rightly, that if there were a major strike that would significantly impact people’s daily and working lives, the Government would do what we would expect them to do and ensure that they put the British public first and do what they could to minimise the disruptions. Is that a fair characterisation of what you actually said, Minister?
Matthew Hancock: That is a fair characterisation. It is a remarkable position for the Labour party to come to and a point of political point scoring if they think it is wrong for a Government Minister to say that we will do all we can to protect the public from the disruption of major strikes. This was in the context of Len McCluskey calling for a general strike and a series of unions making a lot of noise about that. It is perfectly reasonable for the Government to use their co-ordinating facilities to ensure that the response to a strike—especially a generalised and widespread strike—is as well co-ordinated and reasonable as possible. The idea that a Government should not use such facilities is, frankly, ludicrous.
On the same point, I would add one other thing. This is an evidence session, so it is important to bring a few facts to bear. When Mr Doughty talked about the number of working days lost, it struck me that there was something odd about saying “over the last six months”, because that is a very unusual way of using statistics. It rankled because it did not quite ring true, and yesterday I read the labour market statistics that the Office for National Statistics published. In 2011, 1.39 million working days were lost from labour disputes. In 2014, 788,000 working days were lost. When there is further debate on this, which no doubt there will be in Committee, people should probably use the ONS statistics, rather than the odd attribution made by Mr Doughty.
The Chair
If both sides are not being helpful, I am going to be. I want to ensure that the Members who are left to ask questions can ask questions. If they are not replied to in this Committee, I will ask the two Ministers to go away and reply to them in writing. I am going to ask Members to be very succinct in what they are asking for.
Ian Mearns
Q 430 We are clearly in the throes of going through the Bill. Do you not think it is a bit odd, given that this is an evidence session, that we are going through the Committee stage of an important Bill without seeing the evidence that has been thrown up by the consultations that are clearly related to the enactment of the Bill? Is that not a bit perverse?
Nick Boles: No, because the consultations that we have been conducting have been about either the proposals that are not in the Bill—the thing that has got everyone very excited about restrictions on online campaigning was a question in a consultation about whether current offences sufficiently captured any criminality that might take place online. We have asked that question; the responses have come back; and we will be concluding and bringing that forward to the Committee. It has not been about evidence.
On the important services sectors, we have been very clear which sectors we think should be in the Bill—that was in our manifesto in most part. The only question has been: should it be all workers or some? That is a classic matter to settle through regulations, but we will be bringing forward our proposals before Royal Assent, so that everyone can discuss the detail of the regulations as well as the main measures in the Bill.
The Chair
Minister, I do not want you to reply orally to the following questions; I want you to reply in writing, if you can. That is the only way that we will get the questions in.
Ian Mearns
Q 431 You mentioned non-cash benefits of work. Would you not accept that being a member of a trade union brings non-cash benefits such as legal protection?
James Cartlidge
Q 432 I was merely going to quote Roy Rickhuss, the general secretary of Community, which includes a lot of steelworkers, who said on Tuesday to the Committee:
“I do believe a threshold of 50% plus one is fair and reasonable”.––[Official Report, Trade Union Public Bill Committee, 13 October 2015; c. 27, Q66.]
We heard today from Paul Kenny that his position was that he would negotiate and we heard from Mr McCluskey that he is willing—[Interruption.]
James Cartlidge
You get the point. There seems to be growing support for the proposal from some moderate voices.
Nick Boles: I think that is the first time that Len McCluskey has ever been described as a moderate—he might shoot you, Mr Cartlidge.
Jo Stevens
Q 433 I have a question and I would be very grateful for an answer in writing from the Minister for the Cabinet Office. The Bill will give powers to extend the facilities time cap to the private sector. Which private sector businesses do you intend to apply that facilities time cap to? Bear in mind that we heard evidence from John Cridland on Tuesday that private sector employers have no strong views or attach any importance to that.
Julie Elliott
Q 434 My question is to Minister Hancock. We heard evidence this afternoon that check-off actually makes a profit for employers in the public sector and figures were quoted about the numbers of workers who were employed as a result of the profit the public sector makes out of that. Will he answer in writing why he thinks it is correct to put people out of work as a result of removing the check-off facility, the obvious consequence of removing funding from the public sector?
Matthew Hancock: I dispute the premise of the question, but I will answer in writing.
Stephen Doughty
Q 435 Given what the Minister said, it would be very helpful for the Committee—perhaps you can arrange this, Sir Alan—to have a full compendium of the ONS labour market statistics, including all of the forms of industrial action and how those compare with days lost for other reasons. I think that the Minister is selectively quoting.
The Chair
Members, that is the end of today’s session. We are very grateful to everyone who participated and the final Ministers in particular.
Ordered, That further consideration be now adjourned.—(Stephen Barclay.)
Finance Bill (Fifth sitting)
(8 years, 6 months ago)
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The Committee divided: - Ayes: 14 / Noes: 10 - Question accordingly agreed to.
The Financial Secretary to the Treasury (Mr David Gauke)
On a point of order, Sir Roger. You will recall that in our proceedings on Tuesday, the hon. Member for Wolverhampton South West asked whether clause 28, relating to councillors’ expenses, would apply to bicycles. I wish to amend my answer as, contrary to what I said then, the exemption will apply where qualifying payments are made to a councillor for travel on their own bicycle, provided that the qualifying payments are below the statutory approved mileage rates. For bicycles the approved rate is currently 20p per mile. I said on Tuesday that I could see the issue would become a big campaign for the hon. Gentleman, so I congratulate him on meeting the objectives of that campaign before he even began it. I fear this may be an auspicious beginning to his Front-Bench career. I apologise to the Committee, and hope that the correction is helpful.
Clause 37
Changes in trading stock not made in course of trade
Question proposed, That the clause stand part of the Bill.
The Chair
With this it will be convenient to consider:
Clause 38 stand part.
Clause 39 stand part.
Mr Gauke
Clause 37 makes changes to ensure that the correct amount is used when calculating taxable profits when trading stock is transferred between related or connected parties. Clauses 38 and 39 are concerned with the same issue. Clause 38 makes similar changes to those in clause 37 but for cases where a trade ceases; clause 39 does likewise for cases where intangible fixed assets are transferred to a related party.
A number of situations can arise when trading stock is sold or transferred outside the course of trade. The stock can be transferred to a separate business run by the same person, or sold to a business run by a family member. The intention of the tax system is that the stock should always be brought into account at its market value when calculating the taxable profits from the trade—a well established principle that originated in a court judgment many years ago and was subsequently brought into legislation.
Some situations have been identified, however, in which the full market value of stock may not be brought into account. This can occur when transfer pricing rules take precedent over market value rules. Transfer pricing rules aim to identify and bring into account an arm’s length price for the stock. In many situations that will be the same as the market value, but that is not always the case. Where the transfer pricing rules apply, the market value rules are turned off; as a result, there is a risk that the transfer pricing rules will give an amount below market value when calculating profits for taxation, which was not the intention of the legislation. Similar issues have been identified where stock is valued when a trade ceases, and also where intangible fixed assets are transferred between related or connected parties.
Clause 37 is fairly simple. It removes the rule that states that if the transfer pricing rules apply the market value rules cannot also apply, so that where the transfer pricing rules apply in a way that does not give the full market value, the market value rules can be applied, adding the extra amount needed to bring the total up to market value. The true market value will therefore be brought into account when calculating taxable profits. Similar changes are made by clause 38 for cases where a trade ceases, and by clause 39 for cases where intangible fixed assets are transferred to a related or connected party.
Clause 37 removes an unintended consequence whereby two pieces of tax legislation do not, on occasion, work together properly. The changes will ensure that the correct amount is brought into account for tax, as intended by the legislation.
Rob Marris (Wolverhampton South West) (Lab)
As I understand it, all three clauses are anti-avoidance measures designed to clear up conflicting legislation on market price and transfer pricing. Transfer pricing has occasionally been used by companies immorally—not illegally, but immorally—to pay less tax, effectively, by not using the market price. As the three clauses are anti-avoidance measures, I invite my hon. Friends to support them.
Question put and agreed to.
Clause 37 accordingly ordered to stand part of the Bill.
Clauses 38 and 39 ordered to stand part of the Bill.
Clause 40
Carried interest
Question proposed, That the clause stand part of the Bill.
The Chair
With this it will be convenient to discuss the following:
Clause 41 stand part.
New clause 2—Tax treatment of private equity fund managers’ pay—
‘(1) The Chancellor of the Exchequer shall, within six months of the passing of this Act, publish and lay before the House of Commons a report setting out proposals for amending the law to ensure that no element of the remuneration paid to an investment fund manager may be treated as a capital gain, and that such remuneration shall be treated for tax purposes wholly as income.
(2) For the purposes of this section, an “investment fund manager” is a person who performs investment management services directly or indirectly.’
Mr Gauke
Sir Roger, I will speak on clauses 40 and 41 and may remark on new clause 2 in anticipation of remarks we are likely to hear from the hon. Member for Kirkcaldy and Cowdenbeath.
Clause 40 makes changes to ensure that investment managers will pay at least 28% tax on the economic value of the carried interest they receive. Clause 41 makes a change to a definition of disguised management fees rules and supports the legislation in clause 40.
Investment fund managers are rewarded in a range of ways for their work in managing funds. One element of reward is straightforward income in the form of a fee. Hon. Members will recall that we took action in the spring 2015 Finance Act to ensure that fund managers could not disguise management fees as something else in order to pay less tax.
Another key element of the reward involves what is known as carried interest. Carried interest is the portion of the fund’s value that is allocated to the manager in return for their long-term services to the fund. The manager’s reward is therefore dependent on the performance of the fund. Aspects of the UK tax code meant it was possible for asset managers to reduce the effective tax rate payable by them on their carried interest awards; in particular, it was possible for fund managers to pay tax on amounts much lower than their actual economic gains.
The changes made by clause 40 mean that the full amount of carried interest will be charged to tax. Where the carried interest represents capital receipts, it will be taxed at 28% for higher rate and additional rate taxpayers. There will be no extra deduction on account of what is known as base cost shift, which would reduce the amount taxed in the hands of the manager. That will move the basis of the tax charge so that it is the economic gain that is subject to tax. Previously, the carried interest gain was calculated in accordance with the rules on capital gains tax for members of partnerships, but those rules could be interpreted and manipulated in such a way as to reduce significantly the amount of tax payable.
As part of their contract with a fund, an investment manager may be required to invest their own money on similar terms to those that apply to an external investor. To ensure that returns on those co-investments will not be impacted by the change, clause 41 redefines whether an amount is reasonably comparable to the return to external investors. The clause ensures that true arm’s length investments made by the fund manager will not be caught by the new rules.
The clause removes a quirk in the UK tax system that was being exploited in such a way that investment managers were not being taxed on their full economic gain. The changes ensure that capital gains tax will be payable at 28% on the capital element of carried interest received. I therefore hope that clauses 40 and 41 stand part of the Bill.
I would like to make one or two remarks about new clause 2 now, although I will of course respond to what the hon. Member for Kirkcaldy and Cowdenbeath says. New clause 2 proposes two measures: subsection (1) recommends a review after six months of what performance returns should be charged to income, and subsection (2) would define an investment fund manager for the purpose of the new clause.
I am sorry to disappoint Opposition Members, but we will not accept the new clause. It is not necessary to legislate for a review in six months, because the Government have already consulted in this area to ensure that awards will be charged to income tax when it is correct that they are, according to the activity of the fund. The consultation closed on 30 September and we will publish our response, along with any resulting draft legislation, in due course. I dare say that I will have more to say on new clause 2 later this morning, but I look forward to the debate on this group.
The Chair
Before I call Mr Mullin, let me explain for the edification of not only new Members but some who are longer in the tooth that the lead amendment—the one that is first on the selection list—is always called first and moved after its introduction. No other amendment is moved at that time. It is not a question of saying, “I would like to move this.”
New clauses are always taken at the end of a Bill, so while they are debated in the context of the subject matter of the Bill, they are moved—if moved at all—at the end of the Bill. So there will be no occasion yet, as Mr Mullin will wish to know, to move the new clause. However, he is absolutely entitled to speak to it, as I am about to invite him to do.
Roger Mullin (Kirkcaldy and Cowdenbeath) (SNP)
Thank you very much, Sir Roger, for that clarification, which I am sure we all enjoyed. I wish I had fully understood it. [Laughter.]
“I was shocked to see that some of the very wealthiest people in the country have organised their tax affairs, and to be fair it’s within the tax laws, so that they were regularly paying virtually no income tax. And I don’t think that’s right.”
Those were the words of the Chancellor of the Exchequer in April 2012. He was right then, but he needs to do more about it now. We still find such loopholes continuing for the highest remunerated investment fund managers in the country. It may be a mere coincidence that some of them are significant donors to the Conservative party.
I recognise that the Government have moved a little way, but as is attested by page after page of technical explanation notes relating to these matters, we wait to see whether these modest proposals close or create further loopholes. I note the telling sentence in the explanatory notes, which says:
“HMRC will monitor the impact of these provisions”.
That is good. To ensure that we as legislators are fully informed, I am sure that our new clause, which calls for appropriate reporting, will be considered, notwithstanding the Minister’s recent comments.
The few thousand people who work in private equity firms are remarkably well remunerated. In the words of Stephen Feinberg, the head of PE firm Cerberus Capital in 2011:
“In general, I think that all of us are way overpaid in this business. It is almost embarrassing.”
The average European firm’s managing directors can expect to receive about £8 million in total personal compensation and the largest firms pay out even more. Even more junior directors and principals can expect to receive just over £1 million. Those figures will be relatively conservative for London, which has some of the highest paid private equity executives in London.
In some cases, executives have been able to bring tax rates on their carry-down even further by claiming entrepreneurs’ relief. As has been indicated already, private equity fund managers currently shrink their tax bills by arranging to pay 28% capital gains tax, rather than 45% income tax on their carried interest. Carried interest is in effect their remuneration for managing other people’s money and should therefore be taxed as income tax. The fund managers’ ability to pay capital gains tax instead of income tax also allows them to avoid paying national insurance contributions on a major part of their income.
Support for our measure comes from many quarters. Of particular interest to me is the fact that in May 2014 the OECD—not renowned for radical tax positions—released a raft of recommendations to tackle rising income inequality. Those include:
“Taxing as ordinary income all remuneration, including fringe benefits, carried interest arrangements, and stock options”.
The injustice in all this can be seen through a simple comparison. A senior matron in a local hospital or a middle manager in a local further education college on £47,000 a year will have an effective tax rate of about 32.2%, yet a senior private equity executive receiving about £8 million will pay, at most, 29.4%.
Christian Matheson (City of Chester) (Lab)
Does the hon. Gentleman agree that this is an excellent early opportunity for the Conservative party to put words into action by showing that it is, as it claims, the party of ordinary working people, as opposed to, for example, the political wing of the City of London?
Roger Mullin
I fully agree; indeed, I look forward to the Minister’s response in that regard. This may have been a missed opportunity that the Government now recognise and will want to correct.
Let me make another comparison. In my own constituency, my wonderful constituency manager, Lynda Holton, pays about the same effective tax rate as many fund managers who earn 100 to 200 times more than her. [Hon. Members: “Pay her more!”] When I was on the phone to her this morning, she did want me to say “my underpaid constituency manager”. And she is underpaid, but of course I am a devotee to the rules of the Independent Parliamentary Standards Authority in this regard. Surely it cannot be right that people on much more modest incomes have effective tax rates that are higher than those for some of the highest paid people in our society. I am prejudiced in favour of the simplification of tax as well as justice in tax. For both those reasons, I hope that the Government will respond positively to our new clause.
Rob Marris
Sir Roger, I did understand your explanation. As you know, I am new and old—a retread—and I found it very helpful; thank you.
Clauses 40 and 41 are essentially anti-avoidance measures, so hon. Members on the Opposition Benches welcome them. I welcome the fact that there will be no base cost shifting—something that is discussed in the pubs and clubs of Wolverhampton every night of the week; we are very keen on that. However—there is on occasion a “however”—we do not think that clauses 40 and 41 go far enough, because the carried interest is still treated as capital gains. It seems to us that treating carried interest as capital gains is a bad idea and the Government should not permit it. It certainly appears to be a tax loophole—again, not illegal, but immoral—and we think that it should be closed. I have considerable sympathy with the spirit and wording of new clause 2, which was spoken to very eloquently by the hon. Member for Kirkcaldy and Cowdenbeath.
Chris Philp (Croydon South) (Con)
Will the hon. Gentleman join me in welcoming the fact that the current Government have increased the tax rate on these kinds of capital gains from the 18% that it was at under the last Labour Government to 28% today? Would he also like to explain why, during its 13 years in office, the Labour party took no action in this area?
Rob Marris
Looking round the room, I think that one hon. Member, the Minister, will remember that I was not a member of the last Labour Government when I was previously in the House—[Interruption.] I was “supportive” says an hon. Member from a sedentary position; we will get on to that—[Hon. Members: “Ah!”]. The Minister is well aware of this. I am aware that Alistair Darling, when Chancellor of the Exchequer, cut the capital gains tax rate to 18%. I said at the time that I thought that that was wrong and I have to say now that I think that it was wrong. Furthermore, I have to say, bearing in mind the time at which it took place, that it is shocking that I do not recall in the debate on that change any debate about how it would affect positively many right hon. and hon. Members who at that time, within the rules, owned second properties in London, on which they would accrue a capital gain, and on that capital gain, they would pay a lower rate of 18%. The hon. Member for Croydon South is absolutely right to say that it was the wrong thing to do. Putting it up to 28% is a step in the right direction, but on these measures and these activities of investment fund managers, they should pay income tax on what most people, including me, would regard as income.
As I have said, I have considerable sympathy with new clause 2. I shall listen with great interest when the Minister speaks at greater length about the new clause—he said he would and it would be helpful. Having heard his side, I and my hon. Friends will make up our own minds. We are not only swayed by the arguments for equity, equality and justice; we also bear in mind, as the hon. Member for Kirkcaldy and Cowdenbeath mentioned in speaking to new clause 2, the OECD’s recommendation that such incomes should be treated as incomes and be subject to income tax, not treated as capital gain and subject to capital gain tax. To those of us who are not taxation experts, it appears that calling it a chargeable gain is a manoeuvre to lessen the tax paid by those who benefit from that form of remuneration.
Mr Gauke
I will respond to the remarks, not necessarily at length. The comments from the hon. Members for Kirkcaldy and Cowdenbeath and for Wolverhampton South West were pithy.
I shall deal straight away with the question of carried interest. Carried interest is a reward for a manager that is linked to the long-term performance and growth of the funds they manage. It is therefore capital in nature and should continue to be charged against capital gains tax. That has been the approach followed by Governments of both major parties for many years, and it is consistent with what happens in many other jurisdictions.
My hon. Friend the Member for Croydon South was right to say that capital gains tax was 18% when the Labour Government left office. If I remember correctly, it was possible for private equity managers to benefit from taper relief, so there was often an effective rate of 10% for many years under the Labour Government. There at least seems to be a consensus in the Committee that that was not the right approach. We believe we were right to take steps to change the capital gains tax rate, as we did at the beginning of the previous Parliament, but I would still argue that, as is the case in many jurisdictions, it is perfectly reasonable to treat carried interest as essentially a capital gain issue rather than an income issue. Of course, if any part of a manager’s rewards payments are properly regarded as income rather than capital, they should be charged to income tax. That is what drives the Government’s approach. We have launched a consultation to ensure that rewards that should be charged to income tax are always taxed in that way.
I will just pick up a couple of points made by the hon. Member for Kirkcaldy and Cowdenbeath. He is correct that national insurance is not chargeable on capital gains; it is payable only on earned income. However, it is not the case that entrepreneur’s relief can be accessed by investment managers, as the activity of the underlying fund is investing, not trading. Entrepreneur’s relief therefore does not apply in those circumstances.
If I were so inclined, I could quote extensive comments from the likes of Ed Balls, when he was a Treasury Minister, in support of the capital gains treatment of carried interest, and that was a period when the gap between income tax and capital gains tax was much greater, but I will spare the Committee that this morning. I am not sure that Ed Balls is a particular hero of the hon. Member for Wolverhampton South West, but our approach on carried interest is consistent with that of other countries and previous Governments.
We are determined to ensure that the rate at which private equity managers pay tax is never lower than their cleaners pay. That was the case under previous Governments, but it is not the case any more. Nor is it acceptable that what should be charged as income is in fact charged as capital gains. The Government have taken action on those points. I hope that provides reassurance to the Committee and I urge the hon. Member for Kirkcaldy and Cowdenbeath not to press new clause 2.
Chris Philp
May I add a further consideration? Given that, as the Minister said, most other countries treat carried interest as capital gain, if we adopted new clause 2 and started taxing it as income, there would be a significant risk that the population of fund managers in London would simply relocate elsewhere and the UK Exchequer would end up receiving less cash instead of more, thus increasing the tax burden on the rest of us.
Mr Gauke
My hon. Friend makes a good and important point. In thinking through the impact of the policy advocated by some Opposition Members, we need to understand the international implications and the implications for the UK’s competitiveness. Clearly, any assessment of the revenue effects would have to take account of what are likely to be significant behavioural responses. Claims of large revenue sums may be based on a static analysis, without an understanding that there is also a competitiveness point.
Rob Marris
The Minister mentioned Ed Balls. I think the Minister was on a Committee in the position that I am now in when Ed Balls was trumpeting the fact that London had become the financial centre of the world and had surpassed New York because of light-touch regulation. Some of us on the Labour Back Benches pointed out to him that that was a bad move that might end in tears. Sadly, our warnings were more than fulfilled in 2008, with the Lehman Brothers meltdown and what happened in this country. I caution the Minister not to go along with the argument made by the hon. Member for Croydon South that people will go offshore and so on. We should not have had light-touch regulation and we should be careful about regulation now.
Mr Gauke
Again, I think we can find some consensus. I will not dwell on this, Sir Roger, because we will depart from the business before us if we start to discuss the failures of the regulatory system in the run-up to the financial crash in 2008. However, that is why we have undertaken substantial reform of financial regulation in the UK.
We should want a competitive and thriving financial sector in this country, but we must ensure that it does not pose systemic risks for the UK economy as a whole. That is the challenge that the Chancellor has referred to as the British dilemma in having a major financial centre, with many benefits to us. It is important that the City thrives. Some of my ministerial colleagues and I have visited the City—I do not know whether everyone can say that. However, we must ensure that we have a regulatory system that does not impose greater risks on the overall taxpayer. There is a question of judgment here, and ensuring that we have a thriving private equity industry is something we should welcome.
Roger Mullin
To clarify, we do not intend to press the new clause or any of our earlier measures to a vote at this stage, but we will return to them on Report, when we will also take account of the remarks the Minister just made, which I will want to challenge.
Mr Gauke
I very much look forward to debating this matter in future. I have said what I wanted to say. The Government are determined to ensure that income is taxed as income, and we have narrowed the gap between the rates of income tax and capital gains tax. I think that we are getting the balance right and we see that in the clauses we are considering today.
Question put and agreed to.
Clause 40 accordingly ordered to stand part of the Bill.
Clause 41 ordered to stand part of the Bill.
The Chair
New clause 2 would have been taken at the end of the Bill, but Mr Mullin has indicated that he does not wish to move it, so that is now academic.
Clause 42
Vehicle excise duty
Question proposed, That the clause stand part of the Bill.
The Chair
With this it will be convenient to discuss new clause 5—VED rate: impact on carbon dioxide emissions—
‘(1) The Chancellor of the Exchequer must, within two years of the passing of this Act, undertake a review of the impact of introducing a flat rate of Vehicle Excise Duty for all cars regardless of carbon dioxide emissions, except those with zero-emissions.
(2) The review must address (but need not be confined to):
(a) the impact on the UK car manufacturing industry, and ancillary industries, of introducing such a flat rate;
(b) the impact (including the environmental impact) of such a flat rate on sales of low-emissions vehicles; and
(c) the impact of such a flat rate on Exchequer revenue.
(3) For the purposes of this section, a “low-emissions vehicle” is a light passenger vehicle the carbon dioxide emissions of which exceed 0 g/km but do not exceed 100 g/km.
(4) The Chancellor of the Exchequer must promptly lay a report of the review before both Houses of Parliament.’
Mr Gauke
The clause reforms vehicle excise duty to support uptake of the cleanest cars. It also addresses the current system’s unfairness and sustainability challenges. The reformed VED will apply to cars first registered from 1 April 2017 onwards. The reformed tax will raise the same revenue as today, but the changes will ensure that revenues are sustainable in the long term. It supports creation of a new roads fund, so that from 2010 all revenue raised from VED in England will go into the fund, which will be invested directly back into the English strategic road network.
I will set out why the Government believe the current system needs changing. VED for post-2001 cars is currently banded according to carbon dioxide emissions for both first-year rates and annual standard rates. The current CO2 bands are out of date. They were introduced in 2008, when average new car emissions were 158 grams of CO2 per kilometre. Today they are 125 grams of CO2 per kilometre, so owners of many ordinary new family cars such as the Ford Fiesta now pay nothing or next to no VED, and by 2017 owners of nearly three quarters of new cars will pay only £30 a year or less. That has weakened the incentives for people to purchase the cleanest cars.
Clearly that level of revenue is unsustainable. It also creates unfairness. The average VED across all UK motorists is £166, whereas the average VED on a brand-new car is only £85, which will fall to £62 by 2017. Therefore, families who can only afford older cars are increasingly shouldering more of the tax burden than those who can afford to buy a new model every few years. Evidence from studying car purchase decisions across Europe suggests that the first-year rates of VED are the most effective in influencing people’s choices to buy efficient cars. VED annual standard rates are less effective, as people place little weight on future costs, so basing VED annual standard rates on CO2, as the current system does, has little impact on environmental outcomes, causes significant unfairness and makes revenues unsustainable.
Changes made by the clause maintain first-year VED rates based on CO2, but five new VED bands in the nought to 100 grams of CO2 per kilometre range will be created. The new bands will distinguish between zero-emission cars, plug-in and hybrid vehicles and efficient, conventionally fuelled cars. The very cleanest zero-emission cars that produce no air pollutants will pay nothing; rates on the most polluting cars will be increased. The changes strengthen the incentive to purchase the cleanest cars and incentivise continued improvement by manufacturers. For all subsequent years, the new VED system moves to a flat standard rate of £140 for all cars except zero-emission cars, which pay nothing. There will be a standard rate supplement of £310 for cars worth more than £40,000 to apply for the first five years on which the standard rate is paid.
These changes improve fairness for all motorists, strengthen environmental signals and sustain revenues in the long term. No one will pay more in tax than they do today for the car they already own. For cars in the new system, around 95% of motorists will pay less than the average £166 they pay today. The change will put revenues on a sustainable path, but the total car VED burden will not increase. The change updates and strengthens incentives to purchase the cleanest cars and particularly incentivises the uptake of fully zero-emission cars. Their uptake will drive the greatest reduction in carbon emissions reductions as well as air pollutants.
I would like to say a few words about new clause 5 before the hon. Member for Wolverhampton South West has a chance to speak on it. New clause 5 would require the Chancellor of the Exchequer, within two years of enactment, to undertake a review of the impact of introducing a flat rate of VED on the automotive sector, on emissions and on revenue. The new clause calls for such a review within two years of Royal Assent, but hon. Members should note that that would be only approximately eight months after the reforms actually came into effect.
The new clause is not necessary. The Chancellor already announced in the summer Budget that we will do precisely that kind of review as necessary, to assess how the arrangement works in practice and to ensure that the reforms continue to incentivise the cleanest cars. Adopting a flat annual rate of VED while strengthening support for the cleanest cars ensures the change is a fair, simple and sustainable solution able to provide long-term certainty for the UK car market.
Clause 42 strengthens incentives to purchase low-emission cars over efficient conventionally fuelled cars. It sustains VED revenues, allowing for the creation of the roads fund, and it will improve fairness for UK motorists. I stress that the proposed new clause is entirely unnecessary.
In conclusion, clause 42 reforms VED for cars first registered from 1 April 2017. It ensures the tax keeps pace with technological change, is fairer, simpler and sustainable in the long term, and it allows for the creation of a new roads fund, which will ensure our national road network gets the multibillion pound programme of investment it needs. I therefore urge that the clause stands part of the Bill, and hope to persuade the hon. Member for Wolverhampton South West not to press new clause 5.
Rob Marris
With your permission, Sir Roger, I will start by addressing clause 44 in the group, lest I forget it. Have I understood that correctly?
The Chair
No, this is clause 42. I had my rented teeth in when I read it out. I fully understand the hon. Gentleman’s confusion. Clause 42 and new clause 5 are to be debated now. The next batch includes clauses 43 and 44.
Rob Marris
Thank you for that clarification; I did not want that clause to be overlooked. I was doing quite well on the bicycles, and I thank the Minister for his clarification at the start of this session. I hope we can now make similar progress. I will be really motoring on clause 42. I think VED goes back to 1889. I want to thank my researcher Imogen Watson, who has done a sterling job in assisting me with the Bill, particularly clause 42.
I find the Minister’s explanation somewhat unconvincing. The first part of his explanation about equality and the fact that, if left unchanged, by 2017 75% of vehicles would be paying £30 or less VED a year, and that the average for vehicles is £166, but the average for new cars is £85. He seemed to jump from that to a suggestion that, because the banding based on CO2 introduced by the previous Labour Government was successful, we should now abandon it.
I fully understand the revenue arguments for that. That scheme was predicated on giving a tax break to car purchasers, whether individuals or companies, for buying a car that is less polluting—no vehicle is environmentally friendly. The scheme has been successful, as the Minister’s figures attest, but the Government now propose to abandon it.
I can see an argument for looking again at the vehicle excise duty scheme to protect Government revenue, and I can see an argument, particularly in the light of the admitted outrageous behaviour of the Volkswagen Group, for reconsidering whether CO2 should be the sole gas used in the metric for setting the vehicle excise duty that takes into account the pollution produced by a light passenger vehicle when in use. We could, for example, look at nitrogen oxides, commonly called NOx, as another component of pollution in a tax regime to dissuade purchasers of light passenger vehicles from buying vehicles that, through the tailpipe emissions of noxious gases other than CO2, cause hundreds of deaths in this city every year and thousands around the country. Clause 42 does not do that. It sticks to carbon dioxide, which, of course, is a key greenhouse gas, is bad for our climate and is produced in great quantities by light passenger vehicles around the world.
Where I differ significantly from the Minister—I will invite my hon. Friends to vote against clause 42 in a Division on this—is that he said today, unless I misheard, that the rates on the most polluting cars will be increased under the new regime, but that depends on the calculation. I remember what the Minister said about some research indicating that it is the first year of vehicle excise duty that has a particular impact on the purchasing decision. However, it may surprise the Committee to hear that I am an avid reader of The Daily Telegraph on Saturdays.
Rob Marris
The motoring column in the Morning Star is not quite as good as that in The Daily Telegraph, but then it is a big capitalist publication with lots of assets.
Few, if any, Opposition Members will be aware of this, but all Government Members who are avid readers of The Daily Telegraph on Saturdays will be aware—[Interruption.] It appears that Opposition Members are avid readers of all newspapers; my colleagues are so well informed. In the motoring section is Honest John, who answers queries from members of the public. He is so successful that he has a team of three others to help him. He responds to queries on car purchases, what tyres to use, and certain technical stuff that, frankly, I do not really understand.
Rob Marris
Handbrake turns if not U-turns. I suspect that Honest John has considerably more expertise than anybody in this room, and he is always clear that manufacturers aim to produce a car that will last at least seven years. Certain models last longer, and we all know that Jaguar Land Rover engines will last a lot longer than seven years because they are made in Wolverhampton and because they are a high-quality product. But the fact is that from 2017, assuming clause 42 is agreed to, the vehicle excise duty payable over seven years will not increase for the most polluting cars. It will decrease.
Rob Marris
It may be nice for the hon. Gentleman, but it will not be so nice for his great-grandchildren when they reap the havoc from climate change. That Audi emits 181 grams of CO2 per kilometre. Under the new scheme, assuming it is still on sale in March 2017, the car will move up from band I to band J, yet those emissions will receive a discount, as it were, of £60; the current seven-year cumulative duty would be £1,700 but under the new scheme it will be £1,640. The change is not huge, but it is a 3.5% change in the wrong direction.
A petrol Infiniti Crossover, of the Nissan luxury brand, which as far as I know is not made in this country, produces an antisocial 265 grams of CO2 per kilometre. It is currently in band M and liable for a seven-year duty of £4,130. Under the new regime, the charge will be £1,290 less, at £2,840—a 31% drop because of the interaction between the new vehicle excise duty regime and the £40,000 cost threshold, above which a different regime applies. That is a 31% drop in vehicle excise duty over a seven-year period for one of the most polluting light passenger vehicles currently on sale in the United Kingdom.
Now let us look at a Jaguar XF, which currently costs just under £50,000. It is now in band F because its CO2 emissions are 144 grams per kilometre, and costs £1,015 over seven years in vehicle excise duty. Under the new regime, if a car costs less than £40,000, it will move up—up being less polluting—to band H and cost £1,040 over seven years, an increase of £25, or £3.57 a year, as my wonderful researcher, Imogen Watson, tells me. But as for the Jaguar XF, fine vehicle as it is, no doubt with an engine made in Wolverhampton, because its price tag is over £40,000—and remember: its CO2 emissions are 144 grams per kilometre, which is still high, but nothing like the Infiniti’s 265 grams per kilometre—it will cost an extra £310 per year for the first five years, meaning that over seven years the duty will go up to a total of £2,730, an increase of £1,715 or 169%.
Now, I have nothing against the Infiniti—as far as I know I have never been in one—and Nissan is a fine manufacturer, but its luxury model emits 265 grams of CO2 per kilometre, and yet there will be a 31% drop in duty for it over the seven-year cumulative period, whereas the Jaguar is much less polluting, at 144 grams per kilometre, but its duty will increase by just under 169%. That cannot be right.
I urge the Government to think again. They should think about the pulmonary diseases from which thousands of people are dying already. Much—not all, but much—of that illness is arising because of vehicles, including light passenger vehicles. The Government also need to think again about the mixture of bad gases, to put it in lay terms, used as the metric for calculating vehicle excise duty. I also urge them to think again about the CO2 based regime they are proposing from 2017 onwards, because it cannot be that the successor to the greenest Government ever, which is a phrase that hon. Members have no doubt been waiting for me to utter, are moving in the wrong direction by jettisoning what has been—I will try to be dispassionate, although it was my Government who introduced it—a vehicle excise duty regime that has been extremely successful in lessening considerably the CO2 emissions from the fleet of light passenger vehicles in the United Kingdom.
I take the Minister’s point that the way in which new clause 5 is worded means that the review would happen eight months after the new clause would come into effect if the Government do not withdraw clause 42, as I hope they will. If he were to say a little more about the Chancellor’s remarks regarding a review of the impact and effect of clause 42, something to which he adverted in his remarks, I might be reassured and so not wish to press new clause 5 to a Division at the appropriate time. I therefore hope for some reassurance from the Minister; although, capable as he is, he can only rely on what the Chancellor of the Exchequer has said in that regard. I urge Members to vote against clause 42 if the Government do not withdraw it, as it will be bad for the economy, bad for the environment and bad for our children.
Christian Matheson
I feel I ought to add my congratulations to my hon. Friend on his research. He seems to be doing an impressive job. I was also impressed by the recommendation he gave about Honest John in The Daily Telegraph—I might cancel my Saturday subscription to the Morning Star and take the Telegraph instead.
My hon. Friend makes an important point. It is entirely legitimate to build environmental considerations into the taxation system if we want to change people’s habits in order to protect the environment, and the clause gives the impression that the Government are once again rolling back from their pledge to be the greenest Government ever and falling into bad old ways.
There is a way out. Perhaps the Minister should take a pause on the clause, as my hon. Friend suggested, because so much of it is predicated on emissions standards that have been thrown into turmoil by one company, which was not a British company—I do not believe that a British company would partake in such skulduggery. We cannot be absolutely sure that emissions standards across the industry are as they should be, because manufacturers in certain areas have been telling us, shall we say, statements that lack 100% veracity.
It is not only that motorists have been hoodwinked. The Government have potentially lost revenue as a result of emissions figures being massaged, with lower figures given. What are the Minister’s intentions, either through the Bill or perhaps more appropriately through another mechanism, on claiming back any revenue lost as a result of the Volkswagen scandal? The state has lost revenue as a result, so taxpayers have been hoodwinked as well as individual motorists, and although the Bill might not be the right mechanism for this, there must be a role for the Government in chasing down such manufacturers. Perhaps the Minister should not push through new measures linked to emissions standards until he and his colleagues in the Department for Transport are sure that a fair taxation system can be based on those standards. The Minister may wish to heed my hon. Friend’s good advice.
Mr Gauke
Let me try to respond to the points made. On the environmental incentives, consumer research suggests that VED is not an important factor in purchase decisions. Where VED has been shown to play a supportive role is in the highly visible first-year rates. In those we have retained, and indeed strengthened, the environmental signal: for example, first-year rates will double for the most polluting cars.
To drive real emissions reductions in transport, we need to incentivise the uptake of fully zero-emission cars such as pure electric cars. Owners of such cars will pay nothing in the VED system, while highly polluting cars will see a doubling of their rate. As more expensive cars are generally more polluting, it is the case that owners of such cars will continue to pay more than those of smaller, efficient cars through the standard rate supplement.
The point made by the hon. Member for Wolverhampton South West about the number of cars in the lowest band was correct. We are deliberately tightening the incentives at the bottom end. The current structure provides little incentive to buy a car much cleaner than 100 grams of CO2 per kilometre and we believe that such an incentive should be there. It is also worth making the point that nobody’s VED on their existing cars will go up. I made that point earlier, but I want to reiterate it.
Rob Marris
I take the Minister’s point about retrospection, which I referred to in my remarks. He may remember—although others will not—that at one point Alistair Darling, the Labour Chancellor of the Exchequer, did suggest a retrospective VED regime, and I led the Back-Bench rebellion among the Labour ranks and got him to drop it because it was unfair. I tried unsuccessfully in years gone by, under a Labour Government, to get swingeing increases in VED for the most polluting cars. In those days nine of the 10 most polluting light passenger vehicles were not 4x4s, as is commonly thought, but luxury brands such as Maserati. There was only one 4x4 in the top 10.
The Minister understandably referred to the deficit, which remains enormous under this Government, as it did under the previous, coalition Government. My hon. Friend the Member for City of Chester gave the Government a way out, because they do not propose to introduce this measure for another 18 months.
The Government should not be lowering the seven-year total vehicle excise duty on the most polluting cars and raising it considerably on the least polluting cars. I take the Minister’s point about the research to which he is privy regarding the effects of VED being most keenly felt, and therefore the biggest lever revenue-wise for the Government, on the year of purchase rather than in subsequent years. However, the two are not contradictory. It is not an either/or, particularly as the Government have, transparently and helpfully, put forward proposals for a change in regime in 18 months’ time. That is helpful for our debate and that helps prospective car purchasers take into account the change in regime. The clause could be changed on Report if the House so wants.
The Government could introduce a revised regime that protects Government revenue and which would address point about the deficit, to which the Minister reasonably adverted, and the Opposition’s concerns about the seven-year cumulative total dropping markedly—a 31% drop. That could be done by having a high first-year VED that influences purchasing decisions, as the Minister assures us is the case—I have no reason to doubt that; I do not know one way or the other—and dropping the crazy notion of a £140 flat rate thereafter, except for very expensive vehicles that cost more than £40,000, or those on the protected rate of £130.
The Minister and our society, but not purchasers of certain types of vehicles, can have our cake and eat it. We can have the first-year high vehicle excise duty to dissuade purchasers from wrecking the environment even more by buying a very polluting vehicle and we can have a continuing non-flat rate with progressively higher vehicle excise duty each year for more polluting vehicles. We can have both. That would protect revenue and help to lessen the damage to our environment. Again, I urge the Government to rethink, if not the whole scheme, then at least the £140 flat rate and the £130 protected rate for year two onwards. That would square the circle as the Minister seeks on revenue protection and pollution.
Question put, That the clause stand part of the Bill.
The Chair
The hon. Member for Wolverhampton South West will let us know what he wants to do about new clause 5 when we reach the appropriate moment.
Clause 44
Aggregates levy: restoration of exemptions
Question proposed, That the clause stand part of the Bill.
Mr Gauke
Clause 44 makes changes to ensure that the aggregates levy will no longer be due on less environmentally damaging sources of aggregate, including waste from slate, and ball and china clay production. It ensures that exemptions found lawful by the European Commission are reinstated, with retrospective effect from 1 April 2014. Finally, it changes the former shale aggregate exemption to reflect the European Commission’s decision that part of the exemption provided unlawful state aid.
The Government believe it is right that the aggregates levy is used to encourage more efficient quarrying by shifting demand towards less environmentally damaging sources of aggregate. The levy was therefore designed with exemptions for recycled aggregates and by-products of other industrial processes, such as slate or ball and china clay waste. However, following legal action from a UK trade association, the European Commission launched an investigation into several of the aggregates levy exemptions on state aid grounds. During the investigation, the Government were required to suspend the aggregates levy exemptions, which were removed by the Finance Act 2014. The Commission announced on 27 March 2015 that it had found all the exemptions lawful except for part of the shale exemption, namely for shale aggregate that is not produced as a by-product of untaxed materials.
Clause 44 will restore in full the exemptions that were suspended on 1 April 2014, except for the shale exemption. It repeals the removal of the levy exemptions in the 2014 Act, so that they are reinstated with effect from 1 April 2014, the date from which they were originally suspended. Businesses were able to stop paying the aggregates levy on materials covered by the reintroduced exemptions from 1 August 2015. They can also reclaim levies that they have paid on such materials since the exemptions were suspended. To provide clarity to businesses, details of the repayment process have been published by HMRC in a Revenue and Customs brief, ending the uncertainty that businesses such as slate quarries in Wales and ball and china clay quarries in south-west England have faced since the start of the Commission investigation. We estimate that some 120 businesses will be able to claim repayment of the levy for reinstated exemptions.
Clause 44 will also change the former shale exemption, with only the part of the exemption found lawful by the Commission being reinstated. A new exemption process for shale will be introduced so that only shale used for construction purposes, which includes shale aggregate, and shale produced as a by-product of other taxed materials will be taxable under the aggregates levy.
To conclude, clause 44 will reinstate the aggregates levy exemptions found lawful by the European Commission with retrospective effect from 1 April 2014 and change the former shale exemption in line with the Commission’s decision. It will restore the environmental aim of the levy to shift demand towards less environmentally damaging sources of aggregate by exempting such materials once again.
Rob Marris
It may surprise hon. Members to know that aggregates are dear to our heart in Wolverhampton, which was the site of the headquarters of Tarmac, as was, which grew to be one of the biggest aggregates companies in the European Union. I am pleased that the coalition Government were able to persuade the European Commission that the 2002 regime introduced by the then Labour Government was not unlawful state aid and that the decision made in March this year went in favour of our country. It is unsurprising that HMRC now wants to sort out the shouting, it being all over bar the shouting for the 120-odd companies that were caught up while that investigation was ongoing. The clause is an entirely sensible way of going about that, so I invite my hon. Friends not to oppose it.
Question put and agreed to.
Clause 44 accordingly ordered to stand part of the Bill.
Clause 46
International agreements to improve compliance: client notification
Mr Gauke
Clause 46 amends section 222 of the Finance Act 2013 to allow regulations to be made requiring financial institutions and tax advisers to provide their clients with information regarding the automatic exchange of information on financial accounts between tax authorities. The purpose of the power is to support the Government’s ongoing strategy for tackling offshore evasion.
The UK has been an international leader in implementing the automatic exchange of information agreements, including through our G8 presidency. In 2012 we were the first country to sign an enhanced automatic tax information exchange agreement with the United States. In 2013 we signed similar agreements with our Crown dependencies and overseas territories and launched an initiative for multilateral exchange on a global scale. We have since played a leading role in the development and early implementation of the new global standard, known as the common reporting standard or CRS.
To date, 95 countries and jurisdictions have committed to begin sending information automatically under the CRS in 2017 or 2018. As a result, HMRC will receive information on a wide range of financial accounts and investments, of both individuals and entities, from financial centres the world over. That represents a step change in HMRC’s ability to crack down on offshore tax evasion. To coincide with that substantial increase in the flow of information on offshore accounts, we will be introducing a significantly tougher approach towards those who continue to evade their taxes. We have been consulting on a range of enhanced penalties and criminal offences.
In advance of the CRS data being received and the ramping up of penalties, there will be a last chance for people to come forward voluntarily to pay their tax, interest and penalties. That is not a soft touch by any means, and prosecution remains an option for the worst offenders. However, providing notice and a final opportunity for voluntary disclosure is appropriate as voluntary disclosure is a practice we want to encourage. In addition to media campaigns and other communications, the powers introduced by the clause will support the disclosure process. We know from previous experience that direct communication with a customer about their accounts, whether from HMRC, their account provider or their adviser, can be an effective means of communication, getting the message across and influencing behaviour.
The power will allow notification requirements to be placed on businesses that are likely to have advised clients about offshore accounts or to have helped to set up offshore accounts, which includes financial intermediaries, tax advisers and law firms in the UK and overseas subsidiaries of such UK businesses. Under the regulations it will be possible to specify the timing, form or manner of notifications. The scope of the power allows us to enact regulations to ensure that notifications are effectively targeted and proportionate. To that end, we will be consulting closely with the financial services industry as the regulations are drawn up.
I am aware that regulations made under this power will impose burdens on financial institutions, although we do not expect such burdens to be large. However, it is right that financial institutions should play their part in rooting out evasion that increases the burden on honest taxpayers. I am pleased to report that stakeholders to whom we have spoken are generally supportive.
Our current expectation is that the regulations will require financial intermediaries and advisers to notify their UK customers or clients who are known to have, or are likely to have, an offshore account. The regulations are expected to require that they provide such customers with the following information: first, that data on offshore accounts are being collected and will be reported to HMRC from 2017 by 95 other tax authorities; secondly, that HMRC will open a final time-limited disclosure facility in 2016 to regularise their affairs, as necessary, before the data are received; and, thirdly, that there will be a range of penalties, including possible prosecution, for those who continue not to pay the tax they owe.
As noted, we are consulting closely with the industry as the regulations are drawn up to ensure that they are workable, proportionate and effective. We also intend to discuss the possible use of this power to support other tax authorities on a reciprocal basis. Regulations under clause 46 would allow us to require those within scope to notify clients with accounts in the UK who reside in another country about the exchange of data. We would propose to put in place such a requirement only if that other country did likewise as regards accounts held by UK residents within its territory.
This clause forms an important part of our wider strategy to tackle tax evasion. It is a targeted tool to inform offshore account holders both the significant amount of data that HMRC will receive on their financial accounts and make them aware of the opportunity to disclose and the significant penalties that can be applied if they do not. I therefore hope that the clause stands part of the Bill.
The Chair
Before I call the hon. Member for Wolverhampton South West, I have to remind hon. Members that unless and until the recommendation of the Chairman of Ways and Means is adopted by the House—it has not happened yet—the Chairman has no power to suspend the sitting at 1 o’clock. It is therefore up to the Government Chief Whip to move the Adjournment at the time that he feels appropriate; and if he does not do so, you do not get any lunch.
Rob Marris
Clause 46 is a step forward. I congratulate, with one cheer, the Government on that, but it is a small step. The common reporting standard comes in, I think, from 2017. The Government are talking now about another amnesty. How many amnesties can we have? Hon. Members will remember the CD of information on tax evaders that leaked out of Switzerland and was used constructively by several other countries in Europe to clamp down on those of their citizens who had illegally squirrelled away money in Switzerland. My recollection is that we had some kind of amnesty in the United Kingdom for such citizens and, lo and behold, when the Swiss papers—the Swiss bank records—were finally opened several months later, the money had all gone walkies and the amount that the Chancellor of the Exchequer got in was far less than he had been proudly trumpeting would be recovered by HMRC because of that information.
I fear that the same may happen in this case. The clause is a step forward. As for the regulations, which are being consulted on, I say to the Minister that I have not seen it anywhere—it may be somewhere—that this advice should be given in writing and recorded in writing by the financial adviser. That would be a step forward, but a greater step forward to protecting the Revenue from this offshoring avoidance, if not evasion, would be, as I said to the Committee two days ago, to have much more pressure from Her Majesty’s Government on transparency, on beneficial ownership and on the tax havens around the world, which assist aggressive tax avoidance and sometimes assist, perhaps unknowingly, with tax evasion. Many of those tax havens, whether Crown dependencies or otherwise, have a relationship with the United Kingdom. We have considerable leverage there and, in terms of what is disclosed publically, Her Majesty’s Government—both this Government and the previous, coalition Government—have not used that leverage as decisively as we on the Labour Benches would wish.
This externalising of costs to financial advisers, although understandable and welcome, is an externalising of costs, so the financial adviser has to remind the client of the penalties for undertaking certain types of financial transactions. Meanwhile, the number of staff at Her Majesty’s Revenue and Customs, who are one of the lines of defence against aggressive tax avoidance, is being slashed by one quarter, as I understand it, from 70,000 to 52,000 in the period 2010 to 2016. I would be delighted if the Minister could tell me that I have got that figure very wrong—I may have got it wrong slightly around the edge. If he could tell me that the number of HMRC staff is in fact being increased as part of a Government measure to increase markedly the number of staff who can help to crack down on aggressive tax avoidance and illegal tax evasion, I would be delighted, but I fear that he will not reassure me that there has been a major increase in staff. So, although the clause is a step in the right direction, it is nibbling around the edges. A much stronger and more effective way forward would be to have a larger number of properly trained HMRC staff investigating and applying pressure, and the legislation that already exists.
Mr Gauke
I welcome the support for the clause, even if the enthusiasm for it was somewhat limited. I will not dwell at length on the wider issues raised by the hon. Member for Wolverhampton South West, but it is worth pointing out that we have been a world leader in our pursuit of tax evaders. It is a driving force behind the implementation of the common reporting standard, to which all overseas territories and Crown dependencies have signed up. It is also worth pointing out that HMRC has the option to prosecute where it deems that suitable and where it is in the public interest. We are also currently consulting on tougher penalties, including new civil and criminal offences.
The common reporting standard will give HMRC access, for the first time, to data about accounts held by UK residents in over 90 countries, which will make a significant difference to HMRC’s ability to crack down on tax evasion. We are also toughening up the penalties for those engaged in tax evasion. HMRC has been consulting on new criminal offences for corporates and individuals and on new penalties, including applying to the underlying asset for individuals and enablers. The Government will report on the outcome of the consultations shortly. Disclosure facilities are one of a number of approaches—we are also introducing tougher sanctions against those who abuse the rules—and the disclosure facilities have brought in more than £2 billion in tax.
Rob Marris
Can the Minister say briefly what the Government are doing about disclosure of beneficial ownership?
Mr Gauke
The UK is introducing a central register that is publicly available. We are leading the way on that; I am not aware at the moment of any other jurisdictions elsewhere that are pursuing that. We believe that we should set the benchmark, so I am pleased that we as a country are leading the way.
The hon. Gentleman mentioned HMRC resources and so on. He referred to headcount. He will be aware of the dramatic reductions in headcount that occurred under the last Labour Government. In the last Parliament, we invested more than £1 billion in HMRC to tackle evasion, avoidance and non-compliance between 2010 and 2015. We made more than 40 changes in tax laws, closing loopholes and introducing major reforms to the UK tax system. I think most people would agree that it is much harder to avoid and evade taxes now than it was five years ago. Over this Parliament, up to 2020-21, we will be investing more than £800 million in funding in HMRC for matters relating to evasion and general non-compliance, which will help HMRC tackle evasion.
We have a proud record. It is not purely about staff numbers, although as it happens, enforcement and compliance numbers were not reduced in the last Parliament; the reductions in head count were generally within personal tax. It is not simply about headcount; it is about making use of technology and information and acting efficiently. We have a proud record on that front and we will continue in that vein. The clause is part of that process.
Question put and agreed to.
Clause 46 accordingly ordered to stand part of the Bill.
The Lord Commissioner of Her Majesty's Treasury (Mel Stride)
I beg to move,
That further consideration be now adjourned.
The Chair
Before I put the Question, in fairness to Members and, in particular, members of staff, let me say that the Committee has made—without indecent haste and having studied each clause thoroughly—very considerable progress. It is conceivable that we might get to the end of the Bill today. I am conscious of the fact that some hon. Members have considerable distances to travel and may therefore wish to adjourn at an earlier stage. That is entirely a matter for the usual channels; it is not for me to decide. Ordinarily, I would suspend the Committee for a comfort break after about three hours, but I want to make it plain to hon. Members and to staff—because they need to know as well—that I am perfectly prepared to stay in the Chair and see this through if that is the wish of the Committee, but that is a matter for the usual channels to consider.
Question put and agreed to.
Welfare Reform and Work Bill (Ninth sitting)
(8 years, 6 months ago)
Public Bill CommitteesRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Committee divided: - Ayes: 11 / Noes: 9 - Question accordingly agreed to.
The Committee divided: - Ayes: 11 / Noes: 9 - Question accordingly agreed to.
The Committee divided: - Ayes: 9 / Noes: 11 - Question accordingly negatived.
The Committee divided: - Ayes: 11 / Noes: 9 - Question accordingly agreed to.
The Chair
I call a poorly Emily Thornberry to move the amendment.
Clause 16
Loans for mortgage interest
Emily Thornberry (Islington South and Finsbury) (Lab)
I beg to move amendment 19, in clause 16, page 15, line 25, at end insert—
‘(7A) The waiting period before a person can apply for a loan under this section shall be 13 weeks.”
To require that the waiting period before an application for a loan for mortgage interest can be made is 13 weeks.
It is a pleasure to serve under your chairmanship, Mr Owen, ill or not.
Housing costs are never far away from our discussions in this Committee, and the clause brings the subject back into focus in a new and unexpected way. It is not at all clear to me what the Government are trying to achieve with this strange proposal. Support for mortgage interest—SMI—is a benefit that has been in existence in some form or another since 1948. It is the same age as the welfare state and the national health service and is paid exclusively to those on the lowest incomes. It is an important part of the social safety net, the entire principle of which is undermined when we start talking about replacing benefits with loans, which is what the proposal would do.
We have tabled mostly probing amendments to clauses 16 to 18. We do not believe that interest-bearing loans have a place in the social security system at all, but we have sought to highlight some of the most serious flaws in the proposal in the hope that the Government might reassure us that the consequences of the changes have been adequately thought through because, at first blush, it seems to us that they have not.
Towards the end of Tuesday’s sitting, we began to air some of the arguments about waiting periods. The Government made clear their intention to fix the waiting period for SMI loans at 39 weeks, which is three times its current level. That is without a doubt a substantial change. The waiting period was set at 13 weeks in 2008 when the global financial crisis prompted the then Labour Government to shorten the waiting period as part of a range of measures intended to prevent homeowners from going into arrears and facing repossession of their homes.
A research report published by the Department for Work and Pensions in 2011—I recommend the Minister reads it because it is very interesting and enlightening—says that the measures were successful. It stated that the changes
“resulted in more people being assisted, more fully and sooner. Borrowers accrued lower levels of arrears or none at all”
and
“lenders have been more willing to forbear and not seek possession.”
The report was published in 2011 and can be found on the Government’s DWP website.
Reversing the process by reverting to a 39-week waiting period is counterintuitive and likely to be counterproductive. It seems likely to increase the probability of homeowners facing repossession and homelessness when they fall on hard times. If the measure is about saving money, making things more difficult for people who find themselves falling on hard times when trying to buy their home and more likely that repossession will happen earlier is counterintuitive because of the costs to us all to look after the people whose homes have been repossessed. As we discussed on Tuesday, I was disappointed that there was no mention of that in the latest Government impact assessment.
The Government have not been able to provide any reassurance that there is a robust evidence base or, indeed, any evidence base at all for the contention that the charge will not risk an increase in homelessness. The best that the Minister could do on Tuesday was to tell us:
“The Council of Mortgage Lenders has not said that the 39-week wait will drive repossessions. That is an eminently respected organisation, and it would have said if it felt that was the case.”––[Official Report, Welfare Reform and Work Public Bill Committee, 12 October 2015; c. 360.]
I was interested and frankly surprised to hear that, and thought perhaps I had misheard it. I gave the Minister the benefit of the doubt at the time, but I am afraid I do not now. I wondered if the Council of Mortgage Lenders had looked into this in a bit more depth than the Government, so I went back and looked over its submission to the Committee. Imagine my surprise when I found that the view it had expressed on the waiting period was the exact opposite of what the Minister told us! For the sake of clarity, I will quote the submission at length, because it is a very helpful document:
“If the waiting time is extended, as planned, we believe that it will result in more cases of repossession as lenders will not be able to allow their customers to continue to accrue mortgage arrears over this period especially where the customer is unable to make any payment. Lenders already have to carefully balance allowing a person to remain in their home while not allowing their financial position to worsen. Extending the waiting time will only cause additional consumer detriment.”
There we are. The council is against it. The one piece of evidence that the Minister was able to cite in support of extending the waiting period turns out to be nothing of the kind.
The Government have to do better than that. In order to persuade Members on the Opposition Benches, the Government ought to make an effort to produce some evidence or opinion from someone apart from Government Ministers that shows that the proposal is a good idea, and that extending the waiting period for mortgage lenders to get repayment will not mean an increase in homelessness. That, I appreciate, is an uphill task, but it is one they have set themselves.
I appreciate that I am a cracked record on this, but we must go beyond the rhetoric and look at evidence. Social policy should be based on evidence, and I will be interested to hear whether there is any evidence to show that extending the period from 13 weeks to 39 weeks, as the Government want, will actually help anybody.
Hannah Bardell (Livingston) (SNP)
It is a pleasure to serve under your chairmanship once again, Mr Owen. The Scottish National party supports the intentions behind Labour’s amendment 19, because access to support must be available within 13 weeks and not the proposed 39 weeks.
According to Shelter, around £300 million per annum in SMI is “small” in terms of welfare spending, but it is very important:
“It covers the interest payments for around 200,000 home owners on their mortgages, meaning that they are less likely to be forced into having their home repossessed and, ultimately, to end up homeless.”
Shelter also says that SMI has
“tight eligibility criteria and is restricted to very low income households who are out of work, pensioners or sick or disabled. In fact, the overwhelming majority of recipients of SMI either qualify through pension credit or employment and support allowance.”
They are already some of the most vulnerable benefit claimants, so adding a further burden by turning the benefit into a loan is essentially giving with one hand and taking away with the other. We do not support the Government’s attack on the weakest by forcing more and more vulnerable people to take on the added burden of debt just to get out of hard times. How can we define that as welfare?
Amendment 19 would ensure a waiting period for applications by eligible claimants for support with mortgage interest of 13 weeks. That would offer protection against the Government increasing the waiting period, as they have done with statutory instrument No. 1647, which will increase the waiting period to 39 weeks from 1 April 2016. The explanatory memorandum to the instrument states:
“The provisions in this instrument introduce a 39 week waiting period for all working age claimants who are required to serve a waiting period before housing costs, including payment of eligible mortgage interest, can be paid.”
We do not want yet more financial pressure on benefit claimants due to having to wait more than half a year to receive financial help with their mortgage interest payments, let alone the added pressure of that financial help pushing them into further long-term debt when that benefit is turned into a loan. Has the Minister had discussions with the Scottish Government on the implications of that change from support to loan, which will impact the people of Scotland by pushing them into further debt? I would be grateful for information on that.
The Parliamentary Under-Secretary of State for Work and Pensions (Mr Shailesh Vara)
It is a pleasure, Mr Owen, to serve under your chairmanship. First, may I clarify one point concerning the Council of Mortgage Lenders? The other day, I spoke in good faith and on the basis of the many regular meetings that we have with the CML during which the issue has not been raised at all. Indeed, Paul Smee, its director general, did not raise the issue when he was in a meeting with my ministerial colleague, the noble Lord Freud, when they met in early September. Although the CML has definitely said that it believes that the 39-week waiting period will drive repossessions, they are unable to quantify numbers of repossessions. We will continue to work with the CML to assess any such impact in terms of repossessions but we do not believe that these will be significant.
Mr Vara
I have said all I am going to say on that. I would like to make progress as there is a lot to be said this morning. I would rather not get bogged down on issues on which I have made proper statement.
Claimants receiving income-related benefits may claim help towards the cost of their mortgage interest payments. Other than those receiving state pension credit, claimants have to serve a waiting period before the entitlement to help with mortgage interest begins. During the period of 1997 to 2009—the announcement was made in 2008 but the actual impact was in 2009—the waiting period for the majority of working age claimants was 39 weeks. In January 2009, the then Government introduced temporary arrangements reducing the period to 13 weeks, specifically to deal with the economic circumstances and to give additional protection to those who lost their jobs during the recession. At the same time, the maximum value of the mortgage for which support was available—the capital limit—was doubled to £200,000.
It was announced in the summer Budget that, from April 2016, the waiting period will return to the pre-recession length of 39 weeks, but it is important to remember and to note that the higher capital limit of £200,000 will be maintained. Given that the 39-week period was perfectly satisfactory from 1997 to 2009, and that the reduction was introduced purely on a temporary basis to deal with the then economic circumstances, it is right and proper that we should now revert to the former system.
We are all aware that the economy is on the rise and of the huge benefit that the employment market has had. We have record employment levels. I pay tribute to my right hon. Friend the Minister for Employment for her contribution to ensuring the record level of employment that we have at the moment.
The amendment would remove the current broad powers in the Bill that allow the waiting period for SMI to be set out in regulations, replacing them with a narrowly defined 13-week waiting period.
Debbie Abrahams (Oldham East and Saddleworth) (Lab)
The Government’s own impact assessment says that people of pension age are more likely to be affected by the change in SMI. Has there been an assessment to look at the impact that it may have on, for example, their ability to pay social care costs, and at what overlap there may be as a result of having an ageing population?
Mr Vara
May I first pay tribute to the hon. Lady? She has a formidable reputation in health matters, particularly in relation to elderly people. I understand that she co-chairs at least one all-party parliamentary group and chairs another. She comes with a formidable background and I take what she says with considerable respect.
It is important to remember that many pensioners will have had the assets for many years. That is actually the case. During that period, those assets will have appreciated considerably. What we are saying is that the loan will be paid only when the home is eventually sold. If there is no equity left, there will be nothing to pay back to the state. The provision is reasonable given that there are taxpayers who do not own their own home but whose taxes are being used to help others—pensioners or not—with a substantial asset whose value is continuing to appreciate and rise in value thanks to those taxes. As I said, no payment will be required until the property is sold at the end. If there is a balance left, that will be written off.
Emily Thornberry
The Minister asserts extraordinary things. I am sorry, but “We do not believe that this will increase repossessions; there is no evidence that it will” is not an answer to “Please provide the evidence that it won’t.” It is not an answer simply to assert that that will not happen, when common sense dictates that people who do not pay their mortgage for three times as long as before are likely to get into trouble with the lenders. It seems perfectly straightforward.
I will move on to that in a moment, but again, many of the points made by the Minister do not accord with what we know to be the case. As my hon. Friend the Member for Oldham East and Saddleworth said, only 15% of those who rely on the payment are on jobseeker’s allowance. Half of them are pensioners, and 40% of them are disabled, so they are unlikely to be able to get back into work. Social policy should be made on the basis of evidence rather than what one would like the situation to be. I will withdraw the amendment at this stage, but the Government should go back to the drawing board and think again. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Amendments made: 116, in clause 16, page 15, line 25, at end insert—
‘( ) The regulations may define “owner-occupier payment”.’
This amendment provides for regulations under clause 16 to define the term “owner-occupier payment”. The definition will make provision about mortgage interest payments and payments under alternative finance arrangements.
117, in clause 16, page 15, line 26, leave out subsection (8).—(Guy Opperman.)
This amendment removes definitions that are no longer needed for clause 16.
Emily Thornberry
I beg to move amendment 134, in clause 16, page 15, line 34, leave out subsection (11) and insert—
‘(11) A statutory instrument containing regulations under this section may not be made unless a draft of the instrument has been laid before, and approved by resolution of, each House of Parliament.’
To require that regulations under this section must be subject to the affirmative resolution procedure.
The proposed extension of the waiting period is, in my view, just the tip of the iceberg of what we do not know about how the switch from benefit to loan will work in practice. As is often the case with this Government, the Bill contains little detail. The operation of the proposed scheme will instead be set out in regulations, which the Government intend to slip through on the nod, hoping that no one will be paying any attention. Amendment 134 would require that the regulations on the details of the proposed loan scheme under the clause be subject to the affirmative procedure. It is all about democracy.
As drafted, the Bill will allow the Government to implement significant changes to the scheme, including such important details as the loan provider, the rate of interest payable on the loan itself, the terms of repayment and any additional charges and fees, without the need to seek parliamentary approval. That is pretty extraordinary. Amendment 134 would require the regulations to be subject to a debate and a vote in both Houses, so that we may scrutinise the proposals properly and understand what we are being asked to agree to.
I have touched on some of the important details that have been left out of the Bill, some of which I wish to explore further to give a sense of the scale of the issue. The first and most immediately obvious question is, who will provide the loans? In 2011 the Department for Work and Pensions, when it called for evidence, indicated that it would be responsible for administering the scheme, but things seem to have changed. The Bill lists a number of potential providers, including deposit-taking institutions, insurers and local authorities, of which the DWP is not one. So we are left to guess.
The Bill also indicates that administrative fees and interest charges will be payable on loans, but it does not say what will be chargeable or how the rates of interest might be set. It seems ironic, and not at all fair, that when the Government are proposing that loans for mortgage interest should be subject to repayment with interest we do not have the detail in the Bill, so we are not in a position to make an informed judgment.
Another unanswered question is to do with the interaction between the proposed scheme and universal credit. If people continue to receive support for housing costs as part of their monthly universal credit payment, the Government are creating a recipe for confusion by telling claimants that part of their benefit has become an interest-bearing loan that they must at some point repay. We seem to be going in all sorts of different directions at once, and that would seem to undermine one of the core arguments that Ministers put forward in favour of universal credit, which is—I do not know if you remember this, Mr Owen, but we hear it all the time—that it is supposed to be simple. Well, that is not simple.
The Bill is silent on a number of other issues, many of them more complex, that will inevitably arise from the transition period. There are, for example, many features of support for mortgage interest that might make sense for a means-tested benefit, but which seem less appropriate when imposed as a condition for receipt of a loan. Time-limiting claims for those on jobseeker’s allowance is an obvious example. Putting a ceiling on the amount of eligible capital for which SMI is payable is another. The Government do not make it clear whether either of those features will be carried over to the loans that will replace SMI, nor have they made it clear what additional costs the loans may be able to cover.
The Minister recently tabled a number of amendments—we have just heard one—that will change the wording of the Bill to specify that loans will be able to cover “owner-occupier payments” and not only mortgage interest. It is as if a light has just gone on above the Minister’s head and he realises that more ought to be covered. It seems to reflect the Government’s realisation that the scheme has the scope to cover additional costs, such as essential repairs and service charges. For example, some of my pensioners in Bunhill might find themselves in difficulty and needing to go for SMI, but they also have huge service charges for the lifts and cleaning—many of them complain that the service charge is one of the biggest costs that they have—so the Government, at the last minute, have realised that they have to do something about that as well.
If that is the case, the recognition came late in the day, and it indicates that the full implications of the proposal are still not fully thought through. Here we are, in Committee, discussing such an important change—a change of principle, whereby we are asking people to take out a loan in order to pay off the interest on a loan—and the Government have simply not thought it through. We are talking about some of the most vulnerable people, and frankly, leaving aside the fact that the principle is wrong and the measure will not save a great deal of money, to add insult to injury, the Government have not even thought it out.
Finally, the Bill leaves out the crucial issue of the rate at which the loans will be payable. If the payments are too low to cover the full amount of interest owed—for example, if the Government, as they have suggested, use the Bank of England’s standard interest rate as a benchmark—the system will not serve its purpose, and it will increase the incentive for people to abandon their mortgages altogether. I do not know whether the Government have thought of that.
Whatever rate the Government settle on, that important detail deserves more in-depth discussion than the Committee has time for. It simply is not good governance for Ministers to pass legislation that allows them to make changes of such consequence with so little accountability. I hope, therefore, that Government Members will agree that Ministers need to be more forthcoming about their intentions on these issues before the Bill moves forward.
Mr Vara
The amendment would require the regulations made under clause 16 to be subject to the affirmative resolution procedure and to be approved by each House of Parliament. That is not necessary, since the fundamental principles we wish to achieve will have been clearly laid out during the Bill’s passage and debated in Parliament.
We had a call for evidence between December 2011 and February 2012. That is a number of years ago, and there has been debate since then. We have had oral evidence. It was between December 2011 and February 2012 that the idea of providing support for mortgage interest payments through a loan was first introduced, and the majority of responses were positive.
Emily Thornberry
I appreciate that the Minister is saying that he will be able to push the principle through using his majority, but the point I am trying to make is that the details make no sense, and the Government have not thought them through. Given that we have no indication of how the system will work, we need an opportunity to scrutinise it further in a Delegated Legislation Committee so that, frankly, we can give the Government a hand, because they are making a pig’s ear of this. The Minister talked about the call for evidence in 2011 and 2012, but the can was kicked down the road for many years, until after the Conservative party won the election, at which point the Government started pushing these things through without thinking through the consequences.
Mr Vara
There is a fundamental distinction between pushing forward an ideology, while ignoring everything and anything that may be put forward, no matter how sensible it is, and deciding to consider the evidence before the Committee and recognise the reality of Government—that it is important to have flexibility and regulations. That is why Departments across Whitehall have regulations: to be able to deal with the minutiae. It is also important to have that facility so that we can deal with things quickly and take a flexible attitude, rather than go through the cumbersome and time-consuming procedure of having everything approved in Parliament. That is simply not the way the real world works; it was not the way the Labour Government operated, it certainly was not the way the coalition Government operated, and it is certainly not the case now.
Debbie Abrahams
Can I push the Minister a little on interest rates and ask him to reflect on the experience with student loans? They started off in 2010 at a base rate, but they have now gone on to commercial rates. Allowing the issues in the Bill to be fully debated involves important considerations of transparency and openness.
Mr Vara
The hon. Lady makes a very good point, and she gives me the opportunity to make it clear that, unlike students, almost all the people we are talking about have an asset—a property. Therefore, the two groups are fundamentally different. The interest rate we charge will be what we will have paid to borrow the money, and that will depend on the gilt rates at the time. It is as straightforward as that.
The Government recognise the importance of helping owner-occupiers in times of need, and they remain committed to doing so. We are simply changing the nature of the support we provide so that in future the support will be paid to claimants in the form of a recoverable loan. We will recover the loan only when the house is sold, or earlier if individuals’ circumstances change and they are in a position to pay the money back.
Emily Thornberry
This was a probing amendment and an attempt to get more detail from the Government, so I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Question put, That the clause, as amended, stand part of the Bill.
Emily Thornberry
I beg to move amendment 135, in clause 17, page 16, line 13, at end insert—
‘(4) The regulations must make provision for persons applying for a loan to have access to financial advice, which must be provided free of charge by an organisation independent of the qualifying lender.’
To require that those applying for a loan must have access to free and impartial financial advice which is independent of the lender to whom the application is made.
The amendment stands for itself; it is not complicated. It requires those applying for a loan to have access to free and impartial financial advice independent of the lender to whom the application is made. Given that the Department will not be dealing with the loans and will be asking various other organisations to be responsible for such loans, the amendment is consistent with the principle of having free and independent advice. When the coalition Government decided that people should be given access to their pension pots to buy a Lamborghini, they agreed that there should be independent advice before people made such important decisions, so we ask for poor pensioners and disabled people to be given independent advice before they are asked to take out loans.
Mr Vara
Clause 17 allows the Secretary of State to set out in regulations further details regarding the support for mortgage interest loan scheme, including the Secretary of State’s ability to contract out certain functions of the scheme to a third party, such as for the provision of financial advice. To be clear, the Department will administer and provide loans, but the advice and recovery will be provided by a third party, which will be chosen in an open and transparent way so that everyone can see that an independent arm’s length body is providing that advice.
Emily Thornberry
That is very interesting and helpful. Will the advice be free?
Mr Vara
That is a matter to be decided.
The hon. Lady’s amendment seeks to set parameters for the advice: who will provide it, and what it will entail. It is the Government’s intention that the regulations should set out the details of that advice, including the type of provider that we will appoint. We also intend for the advice provided to be broad, including available options other than taking out a loan, the implications of taking out a loan and whether people need to speak to potential beneficiaries of their will who might be affected by their decision, so that they can make a fully informed decision about whether to take out a loan. The amendment is restrictive, as it would prevent the Government from providing the broad advice necessary to claimants when they are considering taking out a loan. I hope that the hon. Lady will withdraw it.
Emily Thornberry
I will, but we will want to hear before Report whether the advice will be free. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Emily Thornberry
I beg to move amendment 136, in clause 17, page 16, line 13, at end insert—
‘(4) The regulations must provide for persons in receipt of Support for Mortgage interest at the time the regulations come into force to continue to receive these payments for a period of no less than 12 months before they are required to apply for a loan.’
To require that regulations setting out transitional protections for existing claimants of Support for Mortgage Interest must include provisions requiring payments to continue to be made on the basis of the current framework for at least 12 months following the date on which the regulations come into force, before they are expected to apply for a loan.
The Chair
With this it will be convenient to discuss Government new clause 13 and Government amendment 129.
Emily Thornberry
Amendment 136 asks for a 12-month grace period. The Government say that there will be a transitional period, and we think it right for existing claimants to be given 12 months in which to work out the implications of the new necessity of taking out a loan in order to pay off another loan. They need a certain period to get their house in order—to coin a phrase—and to get themselves proper advice. We ask for a 12-month grace period before they have to take out a loan.
Mr Vara
The hon. Lady’s amendment would allow existing claimants who are receiving help with the cost of their mortgage interest payments as a benefit to continue to receive that help for at least a year after the new loan scheme has been introduced by regulations. That would effectively allow existing claimants a grace period before they are required to decide whether to continue receiving support for their mortgage interest as a loan. Given that many such claimants have received help with their mortgage as a benefit for some time—in many cases, decades—it would simply be unfair to continue to provide them with help in the form of a benefit while new claimants are offered loans for the same purpose.
Emily Thornberry
Can the Minister point us to the evidence showing that some people have been receiving assistance for decades?
Mr Vara
I do not have that evidence to hand, but I am quite sure, given that the Department is responsible for paying the benefit, that it is there, and therefore that the measure is based on evidence. We all know people who have been on benefits for many years, in many cases for very good reasons, but it is a fact that many people out there have been on benefits for many years, so we must accept the reality of the situation.
Neil Coyle (Bermondsey and Old Southwark) (Lab)
The Minister has suggested that the evidence exists but he does not have it to hand. Will he make some of it available to the Committee?
Mr Vara
First, I pay tribute to the hon. Gentleman, who has a distinguished record in the charitable sector. I take this opportunity to commend him and the hon. Member for Birmingham, Yardley, who also has a charitable background. Many people do such work but it gets very little recognition, so I am happy to give that recognition both to colleagues and to the hundreds of thousands of people working in that sector.
As for the evidence, it is abundantly clear that many millions of people are claiming benefit. It is also a fact that, in the election last May, this Government were given a mandate by the people of this country to put forward these reductions and cuts.
Debbie Abrahams
With respect, it is quite clear that the scale of the cuts being proposed was not one of the issues put to the public. The proposed cuts were published only after the general election, so for the record that is a very misleading statement to make—[Interruption.]
The Chair
Order. I am sure the Minister will correct things if he has unintentionally misled the Committee.
Mr Vara
I have not misled the Committee. It is a fact that the Government said that we would make £12 billion of reductions from the welfare budget, and it was on that basis that the people of this country, in their millions, voted for this Government as a majority Government and gave us the mandate to make those £12 billion of reductions in the welfare budget, as we are doing.
Neil Coyle
The Prime Minister also gave a commitment not to reduce tax credits, so I look forward to that commitment being implemented by the Government. To return to my previous point, where is the evidence for this Committee about decades-long benefit entitlement? [Interruption.]
The Chair
Order. The Minister has been asked a specific question. I do not want the debate to broaden out to the topic of the general election.
The Chair
Order. I am sure that the Minister is going to come back to the provisions before us.
The Chair
Order. Will the Minister take his seat for two seconds, please? Our debate is, I feel, repeating the general election debate. We have specific measures in front of us, and the Minister has been asked a question about evidence. If he could deal with that then move on, that would be useful.
Mr Vara
I have answered the question. It is a fact that millions of people are claiming benefits. We said specifically in our manifesto that there would be £12 billion of cuts. That is what the measure is all about.
Government new clause 13 will enable the Government to put in place, by way of regulations, a framework to support the transition from the current provision of support for mortgage interest as part of the individual’s benefit entitlement to the new system of loans. It is a simple transaction: instead of a benefit, it becomes a loan. The new clause will ensure that the Government can manage the introduction of support for mortgage interest as a loan—in particular, the migration to the new system of those currently receiving support for mortgage interest as a benefit—as they see fit.
In particular, the new clause includes provisions to allow a phased approach to the introduction of support for mortgage interest loans should that prove necessary. It makes it clear that regulations may make provisions about the timing of the transition to the loan system both for new claims and for individuals currently receiving support for mortgage interest as a benefit, and provides that that can be achieved by the issuing of notices to those individuals. Notices may be issued by reference to the area in which an individual lives or the type of qualifying benefit that the individual receives.
Our intention is that existing claimants should be notified well in advance both of the implementation of the changes and of when they will be affected, and that they should be provided with financial advice so that they are aware of the alternatives to receiving a loan and the implications of doing so. Advice will include discussion of the claimant’s financial position, both now and in future, confirming their understanding of the terms of the loan and encouraging them to engage with any beneficiaries there may be in due course.
Hannah Bardell
I will make this brief. In Scotland, people did not vote for the Conservative manifesto or the Conservatives’ austerity cuts—more than 50% voted for the SNP. However, on the specific point I asked about—I apologise if I missed the answer—what discussions has the Minister had on the clause with the Scottish Government? It will affect people in Scotland.
Mr Vara
I will happily answer that question. There has been contact at official level, and the engagement will certainly continue with the Administration in Scotland.
Government amendment 129 is a straightforward technical amendment, which will ensure that new clause 13 has the same extent as clauses 16 and 17 and apply to England, Wales and Scotland. I hope the hon. Member for Islington South and Finsbury will withdraw the amendment and accept Government new clause 13 and Government amendment 129.
Emily Thornberry
I have nothing to add, and I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Amendments made: 122, in clause 17, page 16, line 16, leave out “pay mortgage interest” and insert “make owner-occupier payments”.
Amendment 123, in clause 17, page 16, line 19, leave out “pay mortgage interest” and insert “make owner-occupier payments”.
Amendment 124, in clause 17, page 16, line 28, leave out
“in respect of the mortgage interest”
and insert
“in relation to which the amount is paid”.
Amendment 125, in clause 17, page 16, line 39, leave out from “is” to end of line 40 and insert
“liable to make owner-occupier payments under more than one agreement to make such payments.”
Amendment 126, in clause 17, page 16, line 46, leave out subsection (7).
Amendment 127, in clause 17, page 17, leave out lines 29 to 32.—(Guy Opperman.)
This amendment removes definitions that are no longer needed for clause 17.
Question put, That the clause, as amended, stand part of the Bill.
Emily Thornberry
I beg to move amendment 137, in clause 18, page 17, line 40, leave out “repealed.” and insert “amended as follows—
(a) insert at the end of subsection 1—
‘(1AA) In addition to the conditions set out in subsection 1 a “relevant beneficiary” must be an individual in receipt of pension credit (see section 1 of the State Pension Credit Act 2002).’”
To maintain Support for Mortgage Interest as a benefit for anyone in receipt of State Pension Credit and replace it with a loan only for those in receipt of income-based benefits for people of working age.
The Chair
With this it will be convenient to discuss amendment 138, in clause 18, page 17, line 41, leave out subsections (2) and (3).
This amendment is consequential to amendment 137.
Emily Thornberry
I do not know whether you were in Prime Minister’s questions yesterday, Mr Owen, but many of us were. We heard the Prime Minister say the Government were “very proud” to have kept all their promises to pensioners, but their actions in this Bill show that that is simply not right. The Opposition will make it perfectly clear to pensioners that the Government are going back on their promises to them.
Through the amendment, we want to exempt pensioners from the provisions in the clause. If there is a rationale for the policy, I have yet to work out what it is. On Tuesday, the Minister said—he has said this again today—that
“we believe it is wrong that taxpayers who are unable to afford to buy a home of their own are subsidising claimants who own their own homes.”––[Official Report, Welfare Reform and Work Public Bill Committee, 13 October 2015; c. 356.]
That is a very odd statement in the light of what the Government are doing generally. It is quite startling, because obviously the Minister has forgotten about the Government’s plan to extend the right to buy to housing association tenants. That policy, which the Government say is about supporting home ownership, comes with a price tag of £11.6 billion. That is almost equivalent to the savings that the Government say that they need to make in the welfare budget. Compared with that, SMI is absolute peanuts.
The last time the Government looked at the issue, which was in 2011, as we heard, the then Welfare Reform Minister said in a press release that the existing system was “not sustainable”. That is the justification for the measure and why we are going through it—the Government say that SMI is not affordable. At the time, the Government said, spending on SMI was about £400 million. Now it is £265 million a year. In three years’ time the cost will be £250 million. So far from being unsustainable, the cost is going down. If the Government’s definition of “unsustainable” is spending going down, as projected, we need to have a new dictionary.
In fact, the cost-effectiveness of SMI is one of its most distinguishing features. To quote my new favourite organisation, the Council of Mortgage Lenders, of which the Minister is also a fan, as we have heard, it is important that the Government should
“recognise the relative cost-effectiveness of SMI in preventing repossessions.”
The Government’s impact assessment for the Bill, which was the subject of some back and forth during Tuesday’s sitting, helpfully notes that the average weekly payment to working-age SMI claimants is £38 a week. For pensioners who receive the benefit, it is only £20 a week—so it is £20 a week to keep the roof over the head of a pensioner.
To put that into context, the DWP’s most recent figures show that the average weekly housing benefit payment is £95 a week. If there is even the slightest increase in the number of repossessions as a result of the changes that the Government are proposing, and homeless families have to go into privately rented housing and therefore need to claim housing benefit, we are clearly talking about false economies, because they will be moving into somewhere more expensive. Housing benefit is an average of £95 a week, but SMI for pensioners is £20 a week. That speaks for itself and shows the benefit of making social policy on the basis of evidence rather than rhetoric.
Part of my problem in understanding the Government’s intention is that the proposal seems to fit poorly with the values that they claim to hold. We have recently been through an election campaign—as the Minister was telling us—in which the Government repeatedly claimed that welfare reform would protect the most vulnerable. It was not always clear exactly what they meant by that, but what seemed never to be in doubt was that pensioners would be included, and it was certainly hoped that disabled people would be as well.
As the Government are well aware, the overwhelming majority of those who receive SMI are the very same people whom the Government had promised to protect. Almost half of those who receive SMI are pensioners, and about 40% are disabled. Only 15% are claiming JSA, which is a clear reflection of the fact that, in the majority of cases, the people who rely on SMI support will have fallen on hard times because of increasing age or disability and are therefore unlikely to return to work. A disproportionate number of them are single women.
Again, it is important to look at the evidence, and the evidence is that a disproportionate number of the people who are getting the very small sums of money that keep the roof over their head are single women. I do not know this, but I will make a leap and say that I presume we are talking about poor widows—women who have fallen on hard times and whose partners have died. The Government are taking £20 a week away from poor widows, and that might well result in those women losing their homes. Perhaps those women took their mortgage into retirement after their husband died, or perhaps they had to leave a well-paid job after developing long-term health problems. As we have heard, 40% of them are people with disabilities.
Whoever those people are, however, they are taxpayers. They have spent their entire life working and paying income tax and national insurance. They paid stamp duty when they bought their home, and they might be subject to inheritance tax when they die, although recent announcements suggest that that is less likely to be the case in future. People who receive SMI will have paid into the system and are entitled to expect that there will be a safety net for them when they need it. The Government’s proposal sets a disturbing precedent by turning a benefit to which those people will have contributed into a loan that could be clawed back at some future point. Adding insult to injury, they will be charged for the privilege.
The Prime Minister said yesterday:
“We are very proud to have kept all our promises to pensioners”.—[Official Report, 14 October 2015; Vol. 600, c. 314.]
That is not right. I cannot imagine what he means by that. The other point that my hon. Friend the Member for Oldham East and Saddleworth made is important. The Government have also failed to keep their promises in relation to social care and to what Dilnot called catastrophic costs, and have refused to give assistance to people who will need long-term care. People need to have a home to be able to sell it to pay for their social care.
The Government’s rhetoric again flies in all sorts of different directions. We hear high-flown talk from the Chancellor of the Exchequer about how important it is for people to be able to pass their savings and their money on to the next generation, and to be able, when they die, to hand over to the next generation without being clobbered by inheritance tax. There really does seem to be one rule for the rich and another for the poor. Widows who need £20 a week will have that taken away from them. They will be expected to take out a loan in order to pay off the interest, and will be charged to do so. It is cruel.
Amendment 138, which is consequential to amendment 137, provides that SMI will continue to be paid to low-income pensioners as a non-refundable benefit.
Neil Coyle
My hon. Friend is making a really solid point about the Government’s rhetoric. It is typical of the Government to create a false divide between taxpayers and those in receipt of benefits, as we have discussed in Committee previously. The Government seem to assume that the two do not overlap at all. As my hon. Friend has already pointed out, those who have put into the system for many years will find that the system is not there to support them, and we will now be charging them to draw down what they have contributed over the years. It is typical of a Government who are out of touch with ordinary working people.
Emily Thornberry
I could not agree more, and I thank my hon. Friend. I would go even further: I think that the welfare state and the principles on which we built it are one of the things we should be proud of about being British, and that is being fundamentally undermined by nasty little clauses such as this one. The Government should be ashamed. The Opposition will certainly fight it.
As I have said, amendment 138 is consequential to amendment 137, which will provide for SMI to continue to be paid to low-income pensioners as a non-refundable benefit. If the Government wish to go ahead and convert the benefit into a loan for working-age people, that is an idea that we can debate separately, because that is a different matter, but for pensioners who are unable to work there should be different considerations. If someone is coming to the end of their life and is not expected to work any more—that is what being a pensioner is—or if they are disabled, circumstances ought to be different. If someone is of working age and on jobseeker’s allowance, there might be a different argument—I have yet to be persuaded, but I appreciate that they might be a different group. However, as we have heard, most of the people affected by this nasty little clause will be pensioners.
If pensioners are to consider the Government’s promises worth the paper they are written on, Ministers should go back to the drawing board and rethink this cruel and unnecessary proposal. It is unnecessary because, in the great scheme of £12 billion, how much money are the Government really saving? It is an amount of money that is going down and down, and it is a fraction of a percentage point of the money that is to be saved.
The measure is a mistake. I hope that the Minister is listening—we are trying to help and the Government are making a profound mistake. I will press amendment 137 to a vote. If Conservative Members really believe that they cannot bring themselves to find, from a £120 billion welfare budget, £20 a week to help poor widows not lose their homes, the public have a right to know where the Government stand.
Mr Vara
We have heard a lengthy and passionate speech, the bottom line of which is, “Can we make an exception for pensioners?” As I have said before, we are talking about pensioners who have an asset, probably the biggest and most valuable asset that they have—the biggest asset that most people have is their home. That asset will appreciate in value. There is an element of fairness involved in the measure, as well as ensuring that we make some savings, and it will save £250 million.
I come back to the fundamental point: we are talking about individuals who have an asset that is being subsidised by the taxpayer. Many of those taxpayers do not have such an asset of their own. It is important to recognise that the proposed system is almost the same as the existing system, save that the benefit is converted into a loan that is payable on sale of the valuable asset or, to the extent that there is nothing left in the equity, the Government will write off the balance. All the care, attention and other benefits that pensioners receive will continue.
Emily Thornberry
I hear what the Minister is saying, but his difficulty is that it flies in the face of what the Government are doing for people who are being helped to buy their housing association homes, a measure that will cost £11.6 billion. People—taxpayers—who do not own their own homes are contributing to the £11.6 billion pot that will help housing association tenants to buy. SMI is chickenfeed compared with the amount of money that the Government are using to subsidise that.
Mr Vara
If £250 million is chickenfeed, to quote what the hon. Lady said, I am afraid that people reading our proceedings in Hansard will take a deep breath and say, “This is what those people think of £0.25 billion.” The consequence of several such chickenfeed decisions is the mess that the country is in now.
Neil Coyle
Given what the Minister has said about the economic competence of the Government before last, will he remind us of the savings projected for employment and support allowance and housing benefit in the previous Parliament and whether they were met?
Mr Vara
I do not have those figures to hand, but I am happy to obtain them and write to the hon. Gentleman. He is seeking to make a name for himself. On Tuesday he sought to do so by calling other Members names. Today he seeks to be clever by asking questions, which are important, but which he knows will get a written answer.
The amendment will not make a difference. This is all about fairness.
Debbie Abrahams
I want to push the Minister again. The context of the clause is so important given that the Government have reneged on their commitment to cap social care costs. There has been no assessment of that. During the summer, the Government said that they would not be pushing forward with the Dilnot figures—actually, slightly different figures from the Dilnot ones—and the cap on care costs of £70,000-odd. That is not going to happen. We can add all that together, but it does not seem to have been considered at all by the Government.
Mr Vara
It has been considered. There will be a minimal overlap between the DWP loans and the Department of Health deferred payment arrangements for social care. Those people expected to avail themselves of a deferred social care payment are likely to be mortgage-free or to have income levels above the benefit threshold and so would not qualify for SMI loans. [Interruption.] We will have to agree to disagree. Simply, the bottom line is that the measure is about fairness—fairness for taxpayers. We have to recognise that pensioners have an asset that appreciates, although they are not expected to make any repayment until that asset is sold.
Emily Thornberry
The answers we have heard are profoundly disappointing, and they will be disappointing to the most vulnerable pensioners throughout the country who have paid into a system and who deserve better from the Government.
Neil Coyle
Does my hon. Friend agree that the Minister is making a mockery of the Government’s supposed commitment to protect the disabled and pensioners, which is what they claimed? The Government seem to be relying on a low number of people being affected by the measure to hide their false pretence.
Emily Thornberry
That is absolutely right. Of course, for people who are affected, it will not matter whether the number is a low one—their life will be profoundly affected by the changes made in the Bill. A relatively small amount of money is involved. I appreciate that huge numbers of people will not be affected, but that does not change the principle, the justice or the unfairness to the individual concerned. We will not withdraw the amendment and will press it to a vote.
Question put, That the amendment be made.
The Chair
With this it will be convenient to discuss Government amendments 142, 143, 145, 146, 170, 173, and 163 to 168.
Mr Vara
The social rent clauses relate to the Government’s commitment to achieve a reduction in rents for social housing of 1% a year over four years. That will be good for the tenants and for the taxpayer, saving £1.445 billion by 2020-21. The amendments are the consequence of the Government listening to points made since the Bill was published by social landlords, local government and housing bodies, among others. We hope our amendments address some of the issues raised. The amendments in the group are either concerned with issues of clarification or make small drafting changes.
Amendments 141 and 143 clarify that the 1% rent reduction applies in each relevant year, which is to say, each of the four years from 2016. Amendments 142 and 146, taken together, clarify that the reduction relates to the amount of rent that is payable by a tenant in respect of a year—not the amount that is actually paid by the tenant, which is to recognise the reality that those figures might differ. Amendment 145 is a minor drafting point to clarify that the “amount” relates to the “amount of rent”. Amendment 170 is to simplify the drafting of clause 19 and amendment 173 is a drafting change to the clause to provide that a relevant year for a private registered provider whose practice is not an April start to a rent year will be determined in relation to the rent practice for the number of tenancies, not tenants.
Amendment 163 deals with the potential failures of providers to comply with the clause. It seeks to give the regulator of social housing the appropriate grounds on which to exercise monitoring and enforcement powers. With this amendment we have had regard to how the Housing and Regeneration Act 2008 established such powers and the need to avoid any confusion in how the regulator should exercise its power.
Neil Coyle
The Minister mentioned that he had had meetings with or representations from social housing associations. Will he clarify how many housing associations supported the measures proposed by the Government? How many housing associations have outlined to the Minister and the Department the risk that they might have to close some of the housing they provide as a result of the measure?
Mr Vara
Let me put things into context. We have spoken with a lot of organisations—I have a list at the back of my file and am happy to read out some of the names if necessary. The context of the measure is that it is part of the Government’s £12 billion welfare reduction. We made that absolutely clear to the country at the time of the general election. The people of the country voted democratically, in their millions, and we have a mandate to make those cuts. That is the reality of the position, which might be something that the Opposition do not like—
Mr Vara
I will not give way for the moment; I will finish my answer. The reality is that that is the position.
We have, however, spoken with a lot of people. I simply refer to the comments made by David Orr, the chief executive of the National Housing Federation, when he give oral evidence before the Committee. Most of us were at that sitting on Tuesday 15 September 2015. In response to a question from my hon. Friend the Member for Sutton and Cheam, Mr Orr said:
“I think that, in truth, there is no sector anywhere that is not still capable of making further efficiency savings. That is as true in our sector as it is anywhere else.”
Neil Coyle
Riverside Housing Association has said that
“a year on year rent reduction would make this element of our business loss making.”
St Mungo’s has said that
“the requirement to reduce rents in social housing in England by one per cent per year for four years will result in the loss of supported housing schemes for homeless and vulnerable people.”
The Homes and Communities Agency has estimated that those services save the taxpayer £640 million per year. Where is the saving in the longer term if those services do not exist?
Mr Vara
I am sorry that the hon. Gentleman was so keen to ask his question and so busy thinking about it that he paid no attention to what I was saying. He referred to one organisation. I referred to the comments of the chief executive of the National Housing Federation. We have done our homework, and estimate that we will save nearly £1.5 billion, as I have said.
Amendment 163 provides that a failure or risk of failure to comply with clause 19 is not to be, of itself, a ground for exercising certain monitoring and enforcement powers under part 2 of the 2008 Act, by removing clause 22(1) and (2) from the Bill as introduced. The practical effect of the amendment is that, before exercising those powers, the regulator must satisfy the specific grounds relevant to each power in chapters 6 and 7 of the 2008 Act, as amended by clause 22(3) to (8) of the Bill. Amendments 164 to 168 insert the correct title of the Bill into certain provisions.
Debbie Abrahams
This is my first opportunity to say that it is lovely to see you in the Chair today, Mr Owen. I will speak more fully on the clause when we discuss the Opposition amendments, but I will comment on this first group of amendments. With respect to the Minister, the Government have tabled 42—I have just counted them—amendments, so we can hardly say that they have done their homework. I am afraid that that reflects the nature of the Bill as a whole, which has been made up on the hoof. There has been no thorough assessment. I will go through my concerns about the lack of assessment and the evidence we have heard about today on the impact the Bill will have not just on the viability of housing associations but on their ability to provide affordable housing.
The Minister quoted the National Housing Federation. Housing associations have been working incredibly hard to ensure that they have a going concern and are able to afford to invest in the development of affordable housing. One issue with the clause is that it would threaten their viability and ability to borrow at low interest rates. Moody’s, the credit rating agency for the 44 social landlords, has said:
“A traditional credit strength of English [housing associations] has been the predictability of the policy environment…This stability has been eroded by the sudden removal of the rent-setting formula, which was preceded by limited consultation.”
If anything, the measure will make it even harder. I will speak more fully on the implications, not just for housing associations.
Peter Dowd (Bootle) (Lab)
My hon. Friend referred to the fact that this 1% reduction will have a significant effect. Is she aware that Riverside Housing Association has estimated it will lose £3.9 billion nationally?
Debbie Abrahams
My hon. Friend makes a very good point. I am indeed aware of that. When preparing for this part of the Bill, I was inundated with concerns from my local housing associations about what it will mean for their bottom line and how it will affect their ability to build. Later this afternoon, I will go over what the potential loss of income means for housing associations and local government.
Mr Vara
I simply say to the hon. Lady that we have done what Governments are often accused of not doing: we have listened. Since the Bill was published, we engaged with the relevant communities and stakeholders and listened to their concerns. As will become apparent as the debate progresses, we have made changes that will clarify the position better for those concerned.
I am sorry if the Government, in listening to communities with a view to making the Bill better, are now being accused of doing wrong.
Amendment 141 agreed to.
Amendments made: 142, in clause 19, page 18, line 12, after first “in” insert “respect of”.
This amendment and amendment 146 make clear that the rent in question is the rent due to be paid in respect of a given period.
Amendment 143, in clause 19, page 18, line 12, leave out first “a” and insert “that”—(Guy Opperman.)
The Chair
With this it will be convenient to discuss Government amendments 169, 171, 147, 148, 150 to 153, and 157 to 160.
Mr Vara
This group of amendments deals with some important elements of the rent-setting process. Amendment 144 provides flexibility to registered providers to set reductions in rent of more than the required 1%.
Amendment 169 provides that the rent reductions must be applied on a pro rata basis if the tenant’s tenancy comes to an end part way through a relevant year. The same principle applies if the rent reduction provisions cease to apply to a tenant part way through a year because an exception under clause 20 or an exemption under clause 21 no longer applies. The amendment therefore makes it clear for registered providers that, in the circumstances specified, the rent reduction should apply on a pro rata basis.
Amendment 171 is an essential amendment that clarifies a number of important points. Proposed new subsection (3) provides that the amount payable by the tenant in the preceding 12 months is to be treated as having been the greater of: the amount that would have been payable if the rent at 8 July 2015 had applied during those 12 months; or, if the Secretary of State consents to the use of a different permitted review day, the amount of rent that would have been payable if the rent on the permitted review day had applied during those 12 months. We expect to use the flexibility to grant providers whose normal rent review date is after 8 July permission to use an alternative date as the reference date when calculating reductions, providing there is no evidence that the provider in question has manipulated his rent review date or implemented rent rises after 8 July 2015 in order to avoid the effects of the rent reduction.
Proposed new subsection (3A) clarifies that the Secretary of State’s consent for an alternative permitted review date may be for a particular case or for a description of cases. It is likely that the Secretary of State will issue a general consent covering typical cases. Proposed new subsection (3B) clarifies that, if a tenant was a tenant on 8 July 2015 and continues as a tenant of the same social housing until the beginning of the first relevant year, they will be treated, for the purpose of clause 19(1), as if they had been a tenant for the 12 months preceding the first relevant year—whether or not that is in fact the case—in order to establish the baseline of the rent on which the reductions will then apply.
Naz Shah (Bradford West) (Lab)
It is great pleasure to serve under your chairmanship, Mr Owen. Will the Minister highlight whether service charges are subject to the 1% cut and explain the process for introducing rent reductions for tenants when rents changes are not usually announced until April?
Mr Vara
My answers to those questions will come subsequently. There are other issues at hand and I am more than happy to address the matter raised by the hon. Member for Bradford West. That comes up in another section and I will happily deal with it then.
Amendments 147 and 148 clarify that clause 19(7), which allows an alternative relevant year, applies only to private registered providers. Unlike local authorities, whose budgeting and rent reviews are carried out on a traditional financial year cycle, starting 1 April, the housing association sector practice regarding rent review dates varies. Clause 19(7) therefore enables the use of a different relevant year, where the provider’s rent review date for the greater number of its tenancies is not 1 April. The amendments ensure that that subsection applies only to private registered providers, as local authorities do not need that flexibility.
Amendments 150 to 152 on private registered providers, and amendments 157 to 159 on local authorities, provide some important flexibility in the levels of permissible rent once an exemption has been granted by direction. They modify the provision in clause 21 for limited exemptions from the rent reduction requirement, which means that providers will have the flexibility to make a greater reduction in the rent than that set out in the direction.
Amendment l53, which is for private registered providers, and amendment 160, which is for local authorities, deal with circumstances where a registered provider may need to be able to increase rents but it is not appropriate to completely exempt the provider. They allow the regulator and the Secretary of State to issue a direction setting a maximum threshold up to which a provider can increase rents. The amendments give the regulator and the Secretary of State the tools they need to support registered providers in difficult circumstances while protecting hard-working tenants from excessive increases.
Debbie Abrahams
Again, these are technical amendments, which we have no specific comment on. My earlier remarks apply. It is good that the Government are in listening mode. It is just a shame that that was not done when the Bill was drafted. As I said, I will discuss my particular issues with the clause later this afternoon.
Mr Vara
I take on board the hon. Lady’s comments. Clearly, the matter will come in for further debate and I am sure that other members of the Committee will wish to comment. Mr Owen, I ask the forbearance of you and the Committee as a number of technical amendments need to be dealt with.
Amendment 144 agreed to.
Ordered, That further consideration be now adjourned—(Guy Opperman.)
Finance Bill (Sixth sitting)
(8 years, 6 months ago)
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The Committee divided: - Ayes: 14 / Noes: 8 - Question accordingly agreed to.
The Chair
With this it will be convenient to discuss the following:
Government amendments 11 and 12.
That schedule 8 be the Eighth schedule to the Bill.
The Financial Secretary to the Treasury (Mr David Gauke)
I welcome you back to the Chair this afternoon, Sir Roger; I am delighted to see you.
Clause 47 and schedule 8 introduce new means for Her Majesty’s Revenue and Customs to recover tax and tax credit debts from debtors who refuse to pay. The changes will allow HMRC to recover debts directly from the debtor’s bank and building society accounts, subject to a number of robust safeguards. That will help to level the playing field between hard-working, honest taxpayers and those who seek to play the system and avoid paying debts that they can afford to pay. It will also help to modernise HMRC’s debt collection powers, bringing them in line with those of many other advanced economies.
I would like briefly to explain the context for the changes being introduced, as it is important to understand how this new method of enforcement will complement HMRC’s existing procedures. The UK is a very tax-compliant nation. Last year, £518 billion revenue was paid by 50 million taxpayers. Around 90% of that was paid on time. The remaining 10%—around £50 billion—was not paid on time and was perceived by HMRC as a debt. Most of those with a debt simply need an additional reminder before they pay. Others are businesses and individuals who may be temporarily struggling, unable to pay the full amount that they owe.
HMRC takes a sympathetic approach to those who are in genuine financial difficulty. That includes support through time to pay agreements, allowing people to pay their tax in instalments over a longer time period. There are others who find themselves in a vulnerable position—perhaps because they are going through a difficult time in their lives—and find it a struggle to keep on top of everyday matters such as tax. In those cases, HMRC will provide the additional support that is required. For example, HMRC has established its well-received needs enhanced support service, which offers the appropriate support, including home visits, for HMRC customers who are struggling with their obligations. However, a persistent minority do not respond to HMRC’s repeated attempts at contact and do not require additional help. It is for that group that HMRC uses stronger powers as a last resort.
We should be clear that this measure will apply to the small population of debtors who are refusing to pay what they owe, despite having significant assets in their bank and building society accounts. Almost half of them have more than £20,000 in readily available cash, but are choosing not to pay their tax and tax credit debts. It cannot be fair that some should be able to abuse the process in that way. It is not fair on the people who pay what they owe on time and it imposes costs that are borne by every taxpayer.
The changes made by clause 47 and schedule 8 will allow HMRC to recover funds directly from the bank and building society accounts of those who refuse to pay. In explaining how those changes work, I would like to address three misconceptions about this power.
First, I will address the perception that there is no independent oversight of this power, that HMRC will act as “judge and jury”, and that it cannot be trusted to use these powers responsibly. Independent oversight is embedded in the legislation and debtors will have the opportunity to appeal against the use of the power. Before the stage of direct recovery is reached, taxpayers have the right to challenge and appeal against their liabilities before they go overdue and become debts. These existing rights are unaffected by the changes, and this power will only ever apply to established debts once the appeal process has concluded.
Furthermore, if a “hold notice” is sent to the debtor’s bank or building society to hold moneys up to the value of the debt owed, there is a 30-day window before any funds can be transferred to HMRC. During this time, the debtor can object to HMRC on specified grounds. If they do not agree with HMRC’s decision, they can appeal to a county court.
I understand that some people would argue that a court judgment should always be obtained before that power is used. However, the purpose of this measure is to focus on those who seek to frustrate HMRC’s attempts to recover money owed, including debtors who rely on HMRC taking up costly and lengthy interventions before they agree to settle. These debtors owe, on average, around £7,000 in tax or tax credit debts, and almost half of them have more than £20,000 in their bank and building society accounts.
The power will also be used transparently. HMRC will publish regular statistics on its use, including the number of objections and appeals that are filed and upheld. The Government have also committed HMRC to lay a report before Parliament once the power has been in use for two years.
Secondly, I will address the concern that HMRC will make mistakes and use this power against innocent parties. This is not a measure that will be used lightly, and every case will be assessed by a dedicated team before any action is authorised. However, the Government have listened carefully to the concerns that have been raised, including by those representing vulnerable members of the public and by respected members of the tax agent community. In response to their feedback, the Government have committed that every person whose debts are considered for direct recovery will receive a guaranteed visit from an HMRC officer. This will be an opportunity for debtors to have a face-to-face conversation about their debt, confirm beyond any reasonable doubt their identity and give them another opportunity to pay.
If a payment in instalments is appropriate, that route will be offered, and if the debtor is identified as vulnerable, or needs additional support, they will be referred to a specialist unit and explicitly ruled out of debt recovery through this power.
Finally, I will address the misconception that the moment a tax bill is owed, HMRC will be able to “dip its hands” into someone’s bank account. That could not be further from the truth. As I have explained, this power is a “bolt-on” at the end of a very long process during which HMRC will take every opportunity to recover the established debt that is owed. The power will target those who are making an active decision to delay paying what they owe. Out of the 50 million taxpayers that it serves, HMRC expects to use this power in around 11,000 cases per year. It will only apply to those who have debts of more than £1,000, and a minimum level of £5,000 in funds will be safeguarded in the debtor’s accounts to cover essential living expenses.
I turn to the Government amendments. We have always been clear that vulnerable customers should not be affected by the powers. Our amendments are a result of continued collaboration with the tax agent community and the voluntary and community sector, and I put on the record my gratitude for the advice and expert insight that those groups have given to us. Through this process of open and transparent consultation, we are now able to demonstrate in legislation the strength of the Government’s commitment to protecting vulnerable customers.
Amendment 12 puts a duty on HMRC officers to consider whether debtors may be put at a particular disadvantage if this power is applied to them, and it imposes a positive obligation on officers to ensure that the power is not used inappropriately in those circumstances. Further, amendment 11 requires that HMRC affirms in writing that officers have complied with those requirements.
The amendments make clear our commitment to protecting vulnerable members of society, and we will continue to work with experts to identify best vulnerable taxpayers and provide the most appropriate support.
I hope that clause 47, schedule 8 and amendments 11 and 12 stand part of the Bill.
Rob Marris (Wolverhampton South West) (Lab)
I thank the Minister for that helpful explanation. I place on record also my thanks to the ever helpful Chartered Institute of Taxation for its briefing, with which no doubt the Minister is familiar.
I understand the safeguards, which will, through the amendments, be increased: the debt must be more than £1,000; there will be a face-to-face visit from HMRC; there will be particular reference to and recording of a decision on whether HMRC thinks that the allegedly recalcitrant taxpayer is vulnerable; they must have sufficient money in their account; and there are 30 days in which to object before any money is transferred from the account to HMRC. During the 30-day period, the individual can apply for a court order to prevent HMRC from transferring money without itself seeking a court order, and HMRC must leave £5,000 in the account of the allegedly recalcitrant taxpayer.
There are still problems—for example, with those who hold joint accounts. The innocent or uninvestigated party to a joint account will have to make their objections known to HMRC. The Chartered Institute of Taxation says that
“we do question whether it is right for a totally innocent joint account holder to have to make such representations to stop HMRC accessing their money in the mistaken belief that it belongs to someone else.”
There are safeguards and reassurances, and my critique is not that HMRC would be acting as judge and jury, which the Minister, helpfully, was at pains to say would not be the case. That is not the substance of my critique; it is not why I will ask my hon. Friends to vote against the clause and the consequent schedule in a Division. I oppose clause 47 because in effect it makes one rule for the Government and one rule for everyone else.
I am aware that under what used to be called distraint, HMRC has since, I think, 1970 had powers to seize goods and chattels, not money from bank accounts. The Chancellor of the Exchequer, when mentioning the prospective clause in the Budget on 19 March 2014, said:
“I am increasing the budget of Her Majesty’s Revenue and Customs to tackle non-compliance.”—[Official Report, 19 March 2014; Vol. 577, c. 785.]
I am not entirely sure, despite the Minister’s reassurances this morning, that that has been the case. It certainly needs to be the case.
I did take the opportunity to look at the helpful consultation document on this prospective power; I congratulate the Government on having a long and thorough consultation on the power, and so they should have done because it is quite draconian and quite new. The introduction to the consultation document was written by the then Exchequer Secretary to the Treasury, the hon. Member for South West Hertfordshire, who has deservedly had a promotion. On page 2 of the document, it gives this as one reason for wishing HMRC to have the power to take money out of people’s bank accounts without a court order:
“The current processes for recovering debts…can be costly”.
In paragraph 2.31 on page 9 of the document, it repeats that rationale, saying that
“a county court judgment…can be a slow and expensive process.”
I am aware of that. I and at least two of my hon. Friends knocked around the county courts for a number of years as solicitors. The process can indeed be slow and costly, but the speed and cost of county court processes in England and Wales are in part down to the Government. The Government decide on the resources available to the court system for the administration of civil justice; we are talking about civil matters, not criminal matters. The Government of the day provide or do not provide the money and make or do not make the rules, in liaison with the judges, who write what used to be called the white book and the green book before the Woolf proposals of 1999. The Government have a big hand not only in funding the courts, but in setting the framework within which the courts and their very able staff, judges and advocates operate.
Christian Matheson (City of Chester) (Lab)
My hon. Friend the Member for Wolverhampton South West has given his usual detailed and forensic objections to the clause. Mine are a little bit more about the Minister’s tone and presentation. First, I associate myself with his comments about those who seek to evade their taxes. I have no time for such people. If people are able to pay their taxes, they should do so. That is the price that we pay for a having a stable society that is paid for by taxation. I have no time for people who are, frankly, freeloading on the hard work of others. The hon. Gentleman was correct on that.
My concern with the Minister’s presentation is the tone compared with the tone of the previous discussion about compliance for those who seek to hold their assets offshore. In the discussion on that clause, the hon. Gentleman seemed to suggest that enforcement action would be very much a last resort—a route that HMRC would not necessarily want to go down. With this measure, the enforcement action seems to be a whole lot tougher. If I am doing the hon. Gentleman a disservice, I apologise; this is a genuine point. The impression I get is that once again it seems easier, and the Government seem more ready, to go after, shall we say, the little man, rather than those who have substantial assets elsewhere. However unacceptable individual tax evasion is, I cannot help but wonder whether the real issue we face is large-scale corporate avoidance of tax. I realise that is not part of the clause, Sir Roger, but I hope you will allow me a little latitude. The Government are focusing on small individuals rather than tackling the big issues of corporate taxation. If I am doing the Minister a disservice, I apologise, but I felt that the tone of his presentation focused too much on smaller-scale enforcement.
Mark Garnier (Wyre Forest) (Con)
I sympathise with some of what the hon. Gentleman says, but his party surely cannot be advocating that just because someone is a small person, they can avoid paying taxes. The Government are bringing in measures to tackle every level of tax avoidance. Clearly, some cases will be more obvious than others, but where someone has blindingly obviously not paid tax and has a cash asset, rather than go to the huge trouble and cost of taking them to court, seizing their assets and selling those assets, why is this the wrong thing to do? Surely we must collect tax from everybody who owes it.
Christian Matheson
I certainly do not think we should not take enforcement action against people who can but do not pay their taxes. That is not the issue. I agree with much of what the hon. Member for Wyre Forest said about enforcement for non-payers. I was slightly concerned that in the tone of what the Minister said, there was much more zeal for enforcement action at the lower end of the market than at the higher end. If that is a mistaken impression, I apologise, but there has to be more focus on large-scale corporate taxation, which may of course be covered in other parts of the Bill.
Mr Gauke
Let me say first that I am disappointed the Labour party will not be supporting the measure. I reiterate: these powers will be used at the end of an exhaustive process, whereby there will have been many opportunities for a debtor to have paid the debt and to have challenged the application of the debt to them. It is a measure targeted at individuals and businesses that are making an active decision not to pay or to delay paying the money they owe, despite having sufficient funds in their accounts and despite attempts by HMRC to contact them and encourage them to put their affairs in order. We must remember that we are talking about allowing £5,000 or so to remain in an account, so that people have the sums to make ends meet in the short term. I accept that court action is appropriate in some circumstances, but it imposes significant costs on both the debtor and HMRC.
Mr Gauke
Let me make this point first, which is not an immaterial one: whatever reforms the hon. Member for Wolverhampton South West proposes for the courts system, there are risks of people gaming the system. For example, they might believe that HMRC will not want to go to court to recover a certain level of debt. It is widely acknowledged that there has been robust engagement with interested parties, and as a Government we have listened constructively to those interested parties to make reforms. In circumstances where substantial safeguards are put in place, this is a proportionate measure.
Rob Marris
I appreciate that there can be unrecovered costs, but if HMRC takes on a court case and wins, it is not the case, as the Minister said in his opening remarks, that the costs are borne by every taxpayer, unless the paying party—the losing taxpayer—does not in fact meet that judgment debt. The costs will be paid by the debtor.
Mr Gauke
I come back to the practical operation of this power. Let us remember that the existence of this power will encourage some debtors to pay tax at an earlier stage in the process, knowing that HMRC is able to pursue them more effectively. In Committee, and on the Floor of the House, we often debate the need to reduce the tax gap. The shadow Chancellor made that point on the Floor of the House yesterday. Of course, the tax gap consists of many things, including corporate tax avoidance, which I did not specifically address in my remarks because this clause does not specifically relate to corporate tax avoidance, but these powers could apply to any debt owed to HMRC, including debt involving corporate tax avoidance. If it is determined that a debt is owed, HMRC may pursue it in that way.
Christian Matheson
Will the Minister confirm that this clause will not simply apply to personal accounts but will also apply to corporate and business accounts of corporations that owe tax?
Mr Gauke
The clause will apply to both individual and business accounts, so it could be used in such circumstances. I will not detain the Committee for long on this subject but, on corporate tax avoidance, we have strengthened the capabilities of HMRC’s large business teams, introduced a diverted profits tax and led the way on the OECD’s work on base erosion and profit shifting. The Government have a proud record in that area.
However one looks at the tax gap, and there are different views on the size of the tax gap, corporate tax avoidance is a relatively small proportion. Whether one looks at the authoritative and well-respected HMRC numbers or at Richard Murphy’s numbers, no one claims that corporate tax avoidance is a large part of the tax gap. That is not to say that corporate tax avoidance is not important. It is important, but we also need measures that address all types of people who fail to pay the taxes that are due.
Richard Burgon (Leeds East) (Lab)
I thank the Minister for confirming that the clause will apply to business, as well as to individuals. Will he also clarify whether leaving £5,000 in a debtor’s account will also apply to small businesses that owe tax? I am concerned that small businesses may need much more than £5,000 to pay the wages of their staff.
Mr Gauke
The £5,000 limit applies across the board, including for businesses. This measure is used only at the end of a process and, particularly for businesses, HMRC operates a time to pay process. I dare say that members of the Committee have experience of businesses in their constituencies that have had difficulty in paying tax when it is due and that have engaged with HMRC. Very large numbers of businesses have been able to defer such tax payments because of short-term cash-flow issues and have subsequently repaid them. HMRC does a lot of that, and it works successfully.
Joint accounts have been raised with us, and they have been raised in the Chartered Institute of Taxation briefing. If joint accounts were automatically excluded from the scope of this provision, it would provide an obvious opportunity for debtors to avoid paying what they owe. If we had gone down that route, it would be perfectly reasonable for the Opposition to say that it would be easy to walk around the provisions. However, we have made it clear that we want to strike a balance between recovering money from debtors who are refusing to pay and protecting the rights of other account holders. There are safeguards for joint account holders, including third parties who have a beneficial interest in money in a debtor’s accounts. Direct recovery will only be applied to a pro rata proportion of an account’s balance. All account holders will be notified that action has been taken, and all account holders will have equal rights to object or appeal. Joint account holders will also have clear appeal routes if they feel that their funds have been wrongly targeted.
Rob Marris
I am grateful to the Minister for that explanation and apologise for not being clearer. I was not suggesting that joint accounts should be exempt from the procedure; I was using joint accounts as one more example of why the procedure should not pass into law at all.
Mr Gauke
I disagree with the hon. Gentleman, although I appreciate his point. If we are being serious about reducing the tax gap, this is an important additional measure. According to Treasury figures, which have been verified by the Office for Budget Responsibility, it will bring in something in the region of £100 million a year. It will ensure fairness between those taxpayers—the vast majority—who pay the tax that is due on time and in full, and indeed those who pay shortly after being reminded; and the small minority who persistently fail to pay the tax that is due, which they can indeed pay, and fail to engage with HMRC. The power will ensure that taxpayers are more likely to engage with HMRC and more likely to pay the tax that is due, which will fund the public services that we need and help to reduce the deficit. I will be disappointed if the Opposition, who talk a great deal about wanting to reduce the number of people who fail to pay proper taxes, oppose the measure.
Rob Marris
The Minister suggests that £100 million may be recoverable under the procedure and earlier he estimated that the measure will cover 11,000 people, so that is an average of £9,000 per person. I would suggest that such an amount makes going to court well worth while. Of course Labour wants to close the tax gap and get in revenues. Will he address my point that it is a matter of principle that the Government should not—in my words—make a mess of the courts system and then give HMRC an end run around that?
Mr Gauke
I again make the point that HMRC has a set of processes and procedures, and a number of safeguards, that are not comparable with anything that a private individual or company would have. It is important that we ensure that we have a properly functioning tax system and HMRC must collect substantial sums—I outlined the numbers—so that we have a properly functioning state. It is therefore right, given the safeguards that are in place, that HMRC has an additional tool at the end of a pretty exhaustive process through which there could be six to nine communications with a taxpayer, although I am not saying that that is a minimum in every case because sometimes the process moves more quickly for a repeat debtor. That taxpayer is not likely to be one of the most impoverished people, because the most impoverished, by and large, do not have more than £5,000 in their bank account. It is legitimate that HMRC has these powers. The Government are determined to bring down the tax gap and ensure that people pay the tax due, whether they be big businesses or private individuals. The power is welcome and I hope the Committee will support it.
Question put, That the clause stand part of the Bill.
Mr Gauke
The clause will ensure that when HMRC is party to a tax-related debt, the rates of interest payable by or to HMRC are those contained in tax legislation, whether the debt follows from a court order or not. The measure amends the rate of interest on tax-related debts owed by or to HMRC under a court order or judgment to an appropriate level given prevailing interest rates.
When HMRC is party to a tax-related debt, different interest rates currently apply depending on whether the debt follows from a court order. If the debt results from a court order, an interest rate of 8% applies. In England and Wales, that rate is set out in legislation under the Judgments Act 1838 and County Courts Act 1984, which is the responsibility of the Ministry of Justice. Scotland and Northern Ireland set their own rates of judicial interest, which are also 8%.
If the debt does not result from a court order, the relevant interest rates are set out in the Taxes Acts. Different interest rates apply if tax or other duties payable to HMRC are paid late, and if tax or other duties have been overpaid, resulting in repayment by HMRC. Those rates are linked to the Bank of England base rate. They are currently 0.5% if HMRC is paying interest and 3% if interest is being paid to HMRC.
The changes made by clause 48 will ensure that the rates of interest for all tax-related debts are contained in tax legislation, whether the debt follows from a court order or not. It will affect taxpayers in litigation cases where there is a tax-related judgment debt with interest due and HMRC is either the debtor or creditor. The clause will simplify the HMRC debtor and creditor interest rates. The Government will reduce the rate of interest that applies to tax-related debts payable by HMRC under a court order or judgment to a rate equal to the Bank of England base rate plus 2%, and apply the late payment interest rate of 3% as specified in the Taxes Acts to tax-related debts owed to HMRC under a court order or judgment. The changes will apply to new and pre-existing judgments and orders in respect of interest accruing on and after 8 July 2015. The new rates of judgment debt interest in tax-related cases will compensate the receiving party for any delay in receiving the money that a court has ruled is owed to them at an appropriate level considering prevailing interest rates.
The clause ensures that the rates of interest payable on tax-related debts to which HMRC is a party are all contained within tax legislation. It also reduces the rates of interest on tax-related judgment debts owed by or to HMRC to an appropriate level given prevailing interest rates.
Rob Marris
Having so narrowly lost the vote on clause 47, I am tempted to press this clause to a Division, but I can assure the Minister I will not. However, there are similarities between the measures. My objection to clause 47 and HMRC taking money out of people’s bank accounts without a court order was that it was one rule for HMRC and one rule for everybody else. In the clause immediately following—clause 48—the Government cannot wait to do that again, and I am worried about that trend. I understand that if one wishes for consistency, one cannot always achieve it because the situation depends on the corresponding factor with which another factor is compared. In this case, the Government are saying, “We don’t like comparing the interest payable on moneys owed to HMRC pursuant to a court order,” as per the Judgments Act 1838 or the County Courts Act 1984, which I have written endlessly in pleadings—as they used to be called—over the years. They are saying “We want to compare it with an internal rate that HMRC has for debts owed to HMRC,” which are adjudicated on, but not via the court system.
There is an inconsistency if you have what I would call, for shorthand, an internal, non-court HMRC rate and an external, court HMRC rate. The bigger issue for me, however—this is where I come down decidedly for the opposite comparison for consistency to the Government’s—is that there should be consistency for the individual when faced with the court system of England and Wales, and there should be consistency in the interest rate payable on a county court or High Court judgment, regardless of who the applicant, claimant or, to use the old term, plaintiff is. Even if the plaintiff is HMRC in a tax-related case and the claimant or plaintiff wins that case—HMRC wins—the interest payable upon that judgment debt should be the same as if the winning party who successfully claimed at court that they were owed money was a private individual or a company.
As I said, I appreciate that there is a certain dilemma for HMRC, but it has put up with that dilemma since about 1838, as far as I can tell. I therefore think that it should carry on putting up with that in the interests of having one court rule for everyone, rather than one that relies on the identity of the claimant.
Mr Gauke
I note the hon. Gentleman’s remarks. I am pleased that he is not seeking to divide the Committee on this particular clause, as he did on clause 47. I argue that the measure is appropriate and proportionate. I understand that the Ministry of Justice is reviewing why there is not one court rule regarding when the Judgments Act rate of interest is reduced. I do not know whether the hon. Gentleman takes any comfort from that, but I am pleased to inform the Committee of the fact.
The clause is reasonable in respect of tax-related debts which, of course, flow both ways—there is money owed to HMRC and money owed by HMRC. There should be consistency, and provisions on the rates of interest payable to debts to which HMRC is party should be in tax legislation. Although the hon. Gentleman and I disagree about the operation of the process, I am pleased that we do not have a disagreement on the clause, which I hope will stand part of the Bill.
Question put and agreed to.
Clause 48 accordingly ordered to stand part of the Bill.
Clauses 49 and 50 ordered to stand part of the Bill.
The Chair
We now come to our consideration of the new clauses. All but one of them have already been debated, so with those measures we will move immediately to a decision. Mr Mullin has indicated that he does not intend to seek a vote on any of his new clauses 1 to 3, so the first new clause that we will consider is new clause 4, which has not been debated before.
New Clause 4
Consultation on reforms to the system of tax reliefs for businesses
‘(1) The Chancellor of the Exchequer shall, within three months of the passing of this Act, initiate a public consultation on potential reforms of the system of tax reliefs for businesses which would encourage long term investment and growth in the UK; and the Chancellor shall lay a report of the consultation before both Houses of Parliament by the end of September 2016.
(2) The consultation under subsection (1) must address (though need not be limited to) the following issues:
(a) how reforms to the system of tax reliefs could benefit small businesses in particular;
(b) how such reforms could provide greater long-term certainty about business taxation;
(c) the impact of such reforms on Exchequer revenue; and
(d) the wider societal impacts of such reforms.”—(Rob Marris.)
Brought up, and read the First time.
Rob Marris
I beg to move, That the clause be read a Second time.
Hon. Members will be pleased to hear that I will not detain the Committee for long. I have to say that in recent years HMRC and the Treasury have done a pretty decent job of carrying out consultation. They have got a lot better regarding the number of issues on which they consult, and especially the timeframe allowed. Rushed consultations were carried out under the previous Labour Government and in the early years of the coalition Government, and they sometimes still happen. Sadly, all of us have probably come across such consultations in local government around the country. It is a question of not only a consultation’s terms of reference or whether something is put out for consultation at all—I do not agree with consulting on everything—but the timeframe. HMRC and the Treasury have got better at that, for which I thank the Minister.
For a number of years—this is not exclusive to the coalition Government and the new Government—there has been a lack of monitoring of tax reliefs, which are the substance of new clause 4. I understand that the National Audit Office has criticised the Government for not properly monitoring their tax reliefs. The NAO has found more than 1,300 tax reliefs, which seems an awful lot for a Government of any political colour when we want a simpler system. The NAO found that only 200 of those reliefs are properly monitored by HMRC, meaning that the vast majority—1,100—are not. We could have a long debate—we will not—about what proper monitoring means, but if I understand the NAO report properly, there are difficulties in a major area of our tax regime.
I would venture that Governments around the world have any number of tax reliefs. Other countries may have more or fewer, but we have an awful lot and they are not being properly monitored. They are integral to our tax regime in terms of not only revenue and foregone revenue, but the Government using taxation as a lever to encourage and discourage certain behaviours. We sometimes overlook that, although we debated it earlier in the context of the effect of vehicle excise duty on people’s behaviour when buying light passenger vehicles. Some reliefs are intended to encourage behaviour, such as tax relief on pension contributions, which is quite properly being lessened by this Bill, but an awful lot of relief still remains. We are talking about billions of pounds, so there should be proper monitoring.
It might be that the Minister, who is very assiduous, can reassure the Committee that there is an overarching, ongoing consultation, or even a new consultation, on our tax relief system and, as is proposed in new clause 4, on reforms, specifically in relation to tax reliefs for businesses. I referred to Governments using tax reliefs to encourage and discourage certain behaviours, and there is agreement across the House that tax reliefs have a part to play in fostering the business growth that we all want.
Mr Gauke
The hon. Gentleman will be aware that his party’s leadership is looking to eliminate what I recently heard the hon. Member for Leeds East refer to as £93 billion of “corporate welfare” to reduce the deficit and fund public services. Some of that constitutes tax reliefs or exemptions—however one wants to describe them—including £20 billion of capital allowances. Does the hon. Gentleman consider the £93 billion of “corporate welfare” to be a potential source of revenue for a future Labour Government?
Rob Marris
I thank the Minister for that question. The £93 billion figure has been much misunderstood.
The new clause is part of the probing that we want the Government to carry out on behalf of the country. My hon. Friends the shadow Chancellor and the Leader of the Opposition want to examine what tax reliefs exist—what we are spending the money on, in lay terms, although I appreciate that the process often involves leaving it in the taxpayer’s pocket. As the shadow Chancellor made abundantly clear to the House last night, he is quite rightly in the business of evidence-based policy—[Interruption.] Someone says that he is in the business of “changing his mind”. Yes, my hon. Friend is, as he made clear last night. He interprets the evidence, and evidence changes as more comes out. Like him and, I presume, other colleagues, I want evidence-based policy making.
Whether the figure is £93 billion, £193 billion or £3 billion, the fact is that the Government are foregoing billions of pounds of tax revenues. I think it would be agreed across the House that some of that will be a jolly good thing. There might be differences of opinion among hon. Members about whether a given tax relief is socially desirable, in the sense that its intention is to achieve a socially desirable outcome, and about the evidence of whether a socially desirable outcome is in fact being achieved through the tax measure. There therefore could be disagreement in two ways: first, about the outcome; and, secondly, about whether the tax relief is getting us anywhere nearer to that outcome, or near enough to it—about if we are getting bang for the buck, to use the vernacular.
New clause 4 would require a wider review of tax reliefs for businesses to encourage long-term investment. Were the review carried out and the evidence collected, it might be that my party would call for changes, and I do not rule out the possibility of increases in tax reliefs for businesses. I am not making a pledge on behalf of the Labour party, but it might be that we would think, on the basis of the evidence, that there should be greater relief for businesses regarding research and development—innovation.
On Tuesday, we discussed tax matters for small, growing, knowledge-based companies. We had that debate because the previous Labour Government set up a tax relief regime to encourage research and development. Again, I think there is generally agreement across the House—perhaps not among every right hon. and hon. Member—that encouraging research and development is a desirable goal for any Government. I think that there is also general agreement across the House—again, perhaps not from every Member—that the tax regime has a role to play in encouraging the research and development that almost all of us, if not all of us, want.
Mr Gauke
On a point of clarity, and to reassure businesses throughout the country—including, I suspect, in Wolverhampton—while the shadow Chancellor and the Leader of the Opposition talk about eliminating £93 billion of “corporate welfare”, to use their phrase, is the hon. Gentleman saying that there is no plan to remove capital allowances or R and D tax credits, which constitute sizeable elements of that £93 billion? When he says that the £93 billion “corporate welfare” estimate has been much misunderstood, does he mean by his own leadership?
Rob Marris
I said to the Committee earlier that I was not about to start freelancing on tax policy for the Labour party. That will not surprise the Minister, or other hon. Members. It might disappoint him, but it will not surprise him. He tempted me on two major areas of tax relief for business; I will repeat what I said earlier. We are in the business of trying to develop evidence-based policy, so if the review were, as we hope, to be accepted by the Government and to take place, we might say that business tax relief should be increased in certain areas. I do not rule out that possibility. We might say that it should be reduced in other spheres of activity. I do not know yet.
I cannot help the Minister any more than that, because that is the whole point—or perhaps not the whole point: the major point of having the review is to get the evidence so that all parties can review their policy. After the review, perhaps the Government would review their policy and increase or decrease tax relief for businesses in certain areas.
As to the £93 billion, it has, as I said, been much misunderstood. It may be a coincidence, or perhaps it is a borrowing—many politicians are prone to borrow—but until very recently the most successful federal election in Canada for my party’s sister party, the New Democratic party, of which I used to be a member, was in 1972 under the then leader Ed Broadbent, the honourable member for Oshawa. He was a great leader of the New Democratic party. The campaign slogan referred to “corporate welfare bums”, and it was about large corporations—often multinational—having unfair tax breaks. It was very successful.
There is a tradition in capitalist democracies of corporate welfare. [Interruption.] Yes, there is, and I think we should be honest about that. Sometimes we socialists would support that, to encourage certain activities. I gave the example of research and development; but, yes, there is corporate welfare. Some of it, I suspect—but do not know—is unjustified. I will not know unless we can gather the evidence, and the Labour party will endeavour to gather the evidence as best we can, but it would help if the Government would put resources into doing so by accepting new clause 4, as I hope they will.
Mr Gauke
I thank the hon. Member for Wolverhampton South West for the thoughtful way in which he put his case, injecting, to some extent, scepticism into claims of £93 billion of corporate welfare that might be easily available to reduce the deficit and fund public services, as some of his colleagues have perhaps been inclined to suggest in recent weeks.
Having welcomed some of his remarks I will, I am afraid, disappoint the hon. Gentleman by urging my hon. Friends to oppose new clause 4. The Government are committed to supporting investment and growth through the tax system, which is why we provide businesses with a range of tax reliefs and allowances. The Treasury and HMRC keep all tax policies under review and routinely consult on changes as part of the policy-making process. However, a general consultation on the system of tax reliefs would not be appropriate, since each relief has been designed in a particular way to address a specific issue.
The new clause raises questions about the impact of tax reliefs on investment and growth. The Government recognise the importance of supporting growth and investment through the tax system. In fact, we have designed tax reliefs to do exactly that. For example, through the annual investment allowance, businesses can offset the first-year costs of plant and machinery against their corporation tax liabilities. That supports investment by reducing its cost to businesses. Small businesses in particular benefit from that; 85% of the total value of the annual investment allowance goes to small and medium-sized enterprises.
To support further investment, the Government are raising the permanent level of the AIA to £200,000—its highest permanent level ever. Similarly, R and D tax credits, which the hon. Gentleman referred to, are an incentive to invest in research and development. A recent HMRC study found that each £1 of tax forgone through tax credits stimulates between £1.53 and £2.35 of additional R and D investment, which fosters innovation and helps the economy to grow.
Looking forward, the Government remain committed to supporting investment and growth. We will publish a business tax road map by April 2016, setting out our plans for business taxes over this Parliament. That will provide businesses with the certainty they need to plan for long-term investment.
Rob Marris
I am somewhat reassured by the Minister’s remarks about the framework document in 2010, for which I thank him; I hope that we will see another framework document soon. I am also somewhat reassured about the “road map”, as he calls it, that will be published next year, and the consultations that he referred to. For example, he referred to the annual investment allowance increase in the Budget this year. From memory, when I spoke in the House on the Budget on 8 July I praised that increase in the allowance.
However, the Minister went on to say that he was concerned that if he accepted the new clause it would call into question and create uncertainty about many tax reliefs that are working effectively. With due respect to him, to some extent that assumes what he is trying to prove, by saying that things are working effectively when Opposition Members are asking for an investigation to be carried out holistically—to use the everyday term that is used these days—into the business relief part of the tax regime. The risk is that the Government’s consultations, which I have previously spoken positively about, will become somewhat piecemeal in their approach.
We would like an overarching investigation, because tax reliefs—whether the 1,300 overall, or the smaller number within that 1,300 that apply to businesses—may produce what in chemical terms would be called the cocktail effect. In fact, some such effects have been addressed by provisions in the Bill. That is where a tax measure is put into place and then it is found that it contradicts an existing tax measure. Not surprisingly, those contradictions are often resolved in favour of taxpayers, which is understandable, but correspondingly that is at the expense of revenue for the Exchequer.
A piecemeal approach is not what we need. The new clause is part of our desire to have evidence-based decision making, a holistic approach and zero-based budgeting, to which we are committed. I will not press the new clause to a Division, but I urge the Government to avoid being piecemeal. I beg to ask leave to withdraw the motion.
Clause, by leave, withdrawn.
Mr Gauke
On a point of order, Sir Roger, before we conclude I would like to take a moment to make one or two remarks and thank a number of people. I am pleased that the first Finance Bill of this Parliament has received excellent scrutiny from members of the Committee. Inevitably, more focus has been placed on certain clauses than on others, but debate has been insightful and wide-ranging throughout. I am pleased that the Committee has reached consensus over much of the content of the Bill, including measures that will support businesses and tackle avoidance and aggressive tax planning.
Most impressively, the Committee has displayed unparalleled efficiency, with debate on all clauses concluded in just six sittings. Having done every Finance Bill since 2006, Tuesday afternoon’s session was perhaps my favourite, on the basis that it lasted only 17 minutes.
I thank you, Sir Roger—through you, I also thank Mr Howarth—for your guidance and your wisdom in steering both new and experienced Committee members through what can be a complex process. The hon. Member for Wolverhampton South West is of course both new and experienced. I also thank my hon. Friend the Member for Wyre Forest for his brief unexpected spell as Chairman during the debate on corporation tax, and his guidance at that time was invaluable.
I thank all members of the Committee for their contributions and non-contributions. I thank Members on the Government side for their patience, forbearance and, above all, attendance. I also thank the Members from the SNP and from the Labour party where, for understandable reasons, there has been something of a changing of the guard over the course of the Bill. For me, it is surprising that Front Benchers change from decade to decade, but they perhaps change more frequently when a party is in opposition.
I put on record my thanks to the hon. Member for Worsley and Eccles South (Barbara Keeley) for the work that she undertook from the Labour Front Bench at the beginning of the process. I was delighted to see the hon. Member for Wolverhampton South West in his place. I say delighted, but I was slightly apprehensive, knowing that he is an extremely assiduous Member. It is very difficult to get much past him, and I welcome him to the Front Benches, as I do the hon. Member for Leeds East.
Earlier this week, the hon. Member for Wolverhampton South West compared our encounter to the South by Southwest festival—SXSW—given that we both represent seats that are in the south-west of their particular areas. He is clearly more familiar with trendy festivals than I am. Though I admit that the Finance Bill Committee can occasionally resemble Glastonbury in a wet year—a confused crowd struggling through a vast expanse of mud while someone at the front is shouting loudly—I am pleased that on this occasion, proceedings have been far more harmonious. For that, we have to thank the usual channels: my hon. Friend the Member for Central Devon, who has worked with quiet efficiency with both the hon. Member for Scunthorpe and now the hon. Member for St Helens North. I am particularly grateful for the assistance I have received from my hon. Friend the Economic Secretary, who led on the banking measures.
Finally, I thank the representative bodies and interested parties that have submitted to the evidence to the Committee. I thank our Clerk, Mr Hamlyn, the Hansard Reporters and the doorkeepers, who have ensured the smooth running of the Committee, the HMRC and Treasury officials, and the Office of the Parliamentary Counsel, without whom none of this would be possible. I am sure all hon. Members will join me in looking forward to Report and other stages of the Finance Bill in due course.
Rob Marris
Further to that point of order, Sir Roger. I will briefly add my thanks to many. First, I thank my colleagues who were previously members of the Committee, most notably but not only my hon. Friend the Member for Worsley and Eccles South. I thank the staff both within and outside the House, most explicitly the Treasury staff, who were very astute in assisting the Minister to remember the details of certain matters.
I thank all members of the Committee on both the Government and Opposition sides for their assiduous attention to our proceedings. I thank the Economic Secretary, who was the first Minister I went up against, as it were. I also thank the Financial Secretary, who I went up against a lot more. As Members will know, he has done this a lot more than I have. This is my seventh Finance Bill Committee, but he is probably up to 11 or 12 now, because in years—such as this—there is more than one Finance Bill. I salute his tenacity.
In terms of the speed of proceedings, this is not like Glastonbury; it is more like the South by Southwest festival, which takes place in Texas, where mud is much less frequent and one just makes breezy progress in the sunshine, in a collective and collegial manner. Finally, I thank the two Chairs, Sir Roger and Mr Howarth. I will always remember the Committee, because if I have the honour to lead or contribute for the Opposition officially in future Committees, this will always be the first one in which I was able to do so. Thank you for your chairmanship.
The Chair
All of that is absolutely fascinating and, of course, completely out of order, because none of it is a matter of order for the Chair. As we are rambling on out of order, I thank Members on both Front Benches for their appreciation, which I extend to our Clerk, Matthew Hamlyn, to the officers and staff of the House, without whom none of us could do the job we are required to do. It is much appreciated.
I thank the Committee very sincerely indeed for the courtesy and conduct of the proceedings. Not all Committees are like this, but it has been amicable and sensible. The fact that it has been considered so well and so expeditiously is a credit to all Members present. I hope that those of you who were doing this for the first time have found the process exhilarating and that you will enjoy many more Committees under my chairmanship.
Bill, as amended, to be reported.
Welfare Reform and Work Bill (Tenth sitting)
(8 years, 6 months ago)
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The Committee divided: - Ayes: 10 / Noes: 7 - Question accordingly agreed to.
The Committee divided: - Ayes: 8 / Noes: 5 - Question accordingly agreed to.
The Committee divided: - Ayes: 7 / Noes: 5 - Question accordingly agreed to.
The Committee divided: - Ayes: 7 / Noes: 5 - Question accordingly agreed to.
The Committee divided: - Ayes: 8 / Noes: 5 - Question accordingly agreed to.
The Committee divided: - Ayes: 8 / Noes: 5 - Question accordingly agreed to.
The Parliamentary Under-Secretary of State for Work and Pensions (Mr Shailesh Vara)
I beg to move amendment 172, in clause 19, page 18, line 25, leave out subsections (4) to (6).
This amendment and amendments NC19 and NS1 alter the provision for determining the amount of rent payable in respect of the first relevant year (or a later relevant year) in cases not covered by clause 19(1).
The Chair
With this it will be convenient to discuss the following:
Government amendments 174, 175, 178 and 179.
Government new clause 19—Further provision about social housing rents.
Government new clause 20—Provision about excepted cases.
Government new clause 21—Rent standards.
Government new clause 22—Interpretation.
Government new schedule 1—Further provision about social housing rents.
Government amendments 180 to 183.
Mr Vara
It is good see you this afternoon, Mr Owen, as it was this morning.
We recognise that tenancies will start at different points in the four years of rent reductions and that providers will want to know what rent is set on re-lets for new social housing and for conversions to affordable rent. First, I turn to the more substantial amendments in the group, which make more detailed provision for this situation than clause 19 as introduced. They enable a provider to determine the amount of rent that is initially payable when a tenancy begins after 8 July 2015. The cases are not covered by clause 19(1), which applies to the generality of tenants who were tenants of their social housing on 8 July. Clause 19(1) also governs the future rent reductions for all tenants whose tenancies began after 8 July 2015, once they have been tenants for a full relevant year.
New schedule 1 sets out the details of how rent should be set for different types of new tenancies starting after 8 July 2015. It also provides for exceptions, exemptions and enforcement of the schedule. Part 1 provisions are intended to clarify how the rent reduction requirements should be applied in relation to new tenancies after 8 July, whether that is a re-let of existing housing, new social housing or letting at affordable rent. In the first of those instances, re-lets that exist in social housing will be able to be let at the greater of a social rent or an assumed rent rate.
The social rent rate, which is prescribed in sub-paragraph (4) of new schedule 1, is set in relation to a formula that will be set out in regulations. Sub-paragraphs (7) and (8) provide that the Secretary of State may define “formula rate” in the regulations. Our intention is that the regulations will mirror the formula set out in the rent standard guidance and the Government’s guidance on rent. For supported housing, we will continue to allow rents to be set at up to 10% above formula. I appreciate that these are important issues for social housing providers, so I draw Members’ attention to this change.
The assumed rent rate, which is prescribed in sub-paragraph (5), is based on the rent that was payable under a tenancy in place on 8 July, but the calculation reflects the rent reduction requirement. This is important for providers whose rents have historically been set higher than the formula rent at 8 July 2015. In those circumstances, we do not want providers losing more than 1% year-on-year in rent reductions, which would have been the case if rents for all new tenancies were set with reference to the social rent rate.
Sub-paragraph (6) clarifies that, if the tenant is in that social housing for a part of the year only, or if the requirement ceases to apply because of an exception or exemption, the reduction in rent applies on a pro rata basis. In instances of new social housing, the rent will be set with reference to the social rent rate as described above. Paragraph 3 sets out the case for a person becoming a tenant of affordable rent housing after 8 July 2015.
Sub-paragraphs (2) to (4) provide that the rent payable by that tenant should be set at no more than 80% of what would be the market rent for that social housing and that, in the following years, a reduction of 1% per annum applies. Again, such rents will be on a pro rata basis if appropriate. What constitutes affordable rent housing will be set out in regulations made under paragraph 4. The intention is to mirror the existing policy that homes should be let at affordable rent levels only in certain circumstances, including where there are agreements or arrangements with the Homes and Communities Agency, the Greater London Authority and the Secretary of State, to control housing benefit costs.
Part 2 of the new schedule sets out exceptions to, exemptions from, and the enforcement of, the requirements in part 1. Paragraph 5 makes provision for exceptions that mirror those set out in clause 20, namely low-cost home ownership and shared home ownership accommodation, and various exceptions applicable to mortgagees and other lenders when those persons take steps to enforce a security. Paragraph 5(4) gives the Secretary of State a power to make regulations to disapply the requirements of part 1 in other cases, set out in sub-paragraph (5). In particular, the regulations may include provisions on tenants, tenancies, accommodation and events. They may also include provisions on high-income social tenants and on periods when a tenant’s rent is temporarily reduced or waived.
Paragraph 6 of the new schedule relates to the granting of exemptions by the regulator or the Secretary of State and makes equivalent provision to that in clause 22. Paragraph 7 gives the Secretary of State a power to make provision about the enforcement of the schedule, including provisions to apply part 2 of the Housing and Regeneration Act 2008 with modifications.
Part 3 of the new schedule sets out the conditions relating to regulations made under the schedule. Paragraph 9(2) provides that providers must have regard to guidance when determining assumed rent in cases of properties that were not tenanted on 8 July 2015.
Amendment 172 removes the provision made for other cases in the Bill as introduced. Amendment 174 is a drafting amendment linked to new clause 20 on excepted cases under the new schedule and new clause 19, and is necessary to introduce the new schedule. Amendments 175, 178 and 179 are minor technical amendments consequential on new clause 22 and, in the case of amendment 175, on new clause 21.
New clause 21 expands the provision in clause 19(9) of the Bill as introduced. Sections 194(2A) and 198(3) of the 2008 Act give the regulator of social housing the powers to set and revise standards relating to levels of rent. The new clause ensures that the regulator may not issue standards inconsistent with the provisions on social housing rent in the Bill.
New clause 22 simply gives the meaning of various terms set out in the provisions on social housing rent in the Bill. In particular, subsections (3) and (4) clarify when a tenancy begins, when a tenancy is to be treated as continuing although a new tenancy has been granted, and when a tenancy that has been assigned should be treated as coming to an end. The new clause clarifies the position in respect of new grants of tenancies to the same tenant, including at least one of the tenants who formerly held a joint tenancy, as well as certain changes of tenancy under schedule 1 of the Rent Act 1977 and assignments by way of exchange.
I turn briefly now to new clause 20, which provides the Secretary of State with a power to make regulations regarding the maximum amount of rent payable by a tenant in a category excepted by regulations under clause 20 or the new schedule. It also enables the Secretary of State to make provision regarding the maximum amount of rent payable by a tenant who ceases to be excepted from the rent reduction provisions. Those powers are important as they enable the Secretary of State to make regulations to establish the appropriate rent regime for such excepted cases. In so doing, they give flexibility to make provision for special cases—for example, supported accommodation and tenants whose rent has been temporarily reduced. Providers, at present, have discretion to charge high-income social tenants a higher rent, and it is the Government’s intention to except such tenants from the rent reduction provisions. It is important to ensure, however, that if a tenant’s income drops below the high-income threshold, they will no longer be required to pay a higher rent, and the Secretary of State will be able to require that under the regulations.
We also recognise that providers’ individual circumstances will differ significantly, and the new clause will give the Secretary of State power to provide in regulations for an exemption regime if a provider needs it. The new clause will also enable regulations to provide for enforcement of the regulations by the regulator. Amendment 180 is consequential on the addition of the new clauses and the new schedule to the Bill.
Amendments 181 to 183 are technical and relate to the date upon which the various provisions come into force. Amendment 181 will ensure that the provisions exempting a registered provider from the rent-reduction measures can come into force from the date of Royal Assent. Although we do not expect registered providers to plan on the basis that an exemption will be granted, it is nevertheless important that a provision is put in place quickly where it is needed. Amendment 182 is consequential on amendment 181. Amendment 183 is consequential on the addition of the new clauses and the new schedule and will enable the Secretary of State to introduce regulations quickly following Royal Assent. The Bill provides that such regulations will come into force on other appointed days for other purposes. The intention is to bring the Bill’s provisions into force on 1 April 2016.
I wish to make a clarification. Earlier, I said that paragraph 6 relates to the granting of exemptions by the regulator or the Secretary of State. I said that it makes equivalent provision to that in clause 22. I should have said clause 21.
I thank you, Mr Owen, and colleagues for forbearing in listening to these detailed, technical and necessary comments. I am sure everyone will appreciate that it is necessary to provide such detail on the changes.
Debbie Abrahams (Oldham East and Saddleworth) (Lab)
As I said this morning, I accept that these are technical amendments. We will scrutinise them in detail, but I will make more general remarks in relation to my own amendments.
Amendment 172 agreed to.
Amendments made: 147, in clause 19, page 19, line 9, after “a” insert “private”.
This amendment and amendment 148 secure that only private registered providers may have relevant years starting on a date other than 1 April.
Amendment 173, in clause 19, page 19, line 10, leave out “tenants” and insert “tenancies”.
This amendment secures that a private registered provider’s usual practice is determined by reference to numbers of tenancies.
Amendment 148, in clause 19, page 19, line 19, after “A” insert “private”.
Amendment 174, in clause 19, page 19, line 22, at end insert—
“( ) This section is subject to—
(a) section (Provision for excepted cases) (provision for excepted cases);
(b) Schedule (Further provision about social housing rents) (further provision about social housing rents).”
This amendment is a drafting change linked to amendment NC20 (a new clause about excepted cases) and amendment NS1 (a new Schedule making provision about initial levels of rent for tenancies beginning after the beginning of 8 July 2015).
Amendment 175, in clause 19, page 19, line 23, leave out subsections (9) and (10).—(Guy Opperman.)
This amendment and amendments NC21 and NC22 secure that the provision in subsections (9) to (10) is also applied to the provision about levels of rent that appears in the new clause and new Schedule added by amendments NC20 and NS1.
Debbie Abrahams
I beg to move amendment 21, in clause 19, page 19, line 25, at end insert—
“(9A) The Secretary of State must, within 12 months of this section coming into force, produce a plan to offset the impact of lower social rents on housing associations and local government.”
To require the Secretary of State to produce a plan to offset the impact of lower social rents on housing associations, so that their ability to build new affordable homes is not affected.
The Chair
With this it will be convenient to discuss the following:
Amendment 85, in clause 19, page 19, line 25, at end insert—
“(9A) The Secretary of State must, within 12 months of this section coming into force, produce a report outlining the impact of the reduction in social housing rents on the availability of accessible and supported housing.”
To require the Secretary of State to report on the impact of lower social rents on the availability of accessible and supported housing.
Amendment 184, in clause 19, page 19, line 35, at end insert—
“(11) Sections 19 to 22 will cease to have effect on 1 April 2020.”
The Bill as currently drafted does not explicitly provide for the end of the rent reduction policy in 2020. This amendment would clarify this.
Debbie Abrahams
I hope everyone has had a good lunch. The amendments are in my name and those of my hon. Friends.
Clause 19 requires registered social housing providers to reduce the amount of rent payable by a tenant in social housing in England by 1% a year for four years from 1 April 2016. The Government argue that the measure will save money paid on housing benefits. They estimate in the impact assessment that the saving will be approximately £1.995 billion, which, on the surface, seems like a good deal for social tenants. However, there are significant implications for current and future renters.
The Local Government Association has estimated that councils in England will lose more than £2.6 billion, and that 19,000 fewer affordable homes will be built by 2019-20 as a result of the measure. I will come to what that will mean in terms of fewer homes in my area of Oldham, but for housing associations in general, the situation is even worse. The National Housing Federation calculation is that housing association income, collectively, will reduce by £3.85 billion over the next four years, resulting in 27,000 fewer homes being built. That contrasts markedly with the Office for Budget Responsibility assessment in the Budget, which predicts 14,000 fewer affordable homes being built.
Will the Minister confirm how that discrepancy has arisen? Is there a calculation that we are not aware of? Exactly how has that difference come up between the OBR’s 14,000 and the figures of the LGA and the NHF? May I also ask why that was not included in the impact assessment process? At the same time, will he confirm the actual figure for loss of income to be suffered by housing associations by 2020? My colleagues will want to comment about their own areas, but in my area the estimate for loss of income is £15 million. In places such as Oldham, that has significant implications for affordable homes.
In May 2014, following the 2013 spending review, the Government committed to a 10-year rent settlement, which was meant to introduce the necessary long-term certainty needed to attract private investment into building new affordable homes. What has changed? As a result of the longer-term planning with assumptions about what rental incomes they would be receiving, housing associations have been able to borrow for house building at reasonable rates, attracting £6 from the private sector for every £1 of public money, as the Minister said this morning. Moody’s, the rating agency for the social landlords, commented that the change to the 10-year rent settlement and long-term planning came out of the blue, without any consultation, and is making things incredibly difficult, threatening the viability of many housing associations. We will debate that under a subsequent clause. The OBR acknowledged the difficulty caused by such a sudden change—it is due to be implemented next year. It also said—this is absolutely key—that:
“We do not expect private sector house-builders to offset this effect to any material degree.”
That is in paragraph 3.84 of the OBR publication accompanying the July Budget.
The ability of housing associations to borrow and the effect of the measure on their ability to build more affordable homes are key concerns not only of housing commentators, but of the 1.38 million or so people who are on local authority housing lists—that is a 2014 figure, the latest produced by the Government—71% of whom are in receipt of housing benefit. I will be grateful if the Minister confirms what assessment has been undertaken. How will the provision affect social housing waiting lists? We know from last year’s Work and Pensions Committee report on affordable housing that there are considerable issues for people in receipt of housing benefit in being taken on by private sector landlords. What will be the impact of the measure on social housing waiting lists and people’s ability to move into the private rented sector?
It is important that we look at what the Government are proposing in the context of the housing market as a whole. Most people recognise—possibly the Government do not—that there is a housing crisis in this country, and this measure will make it worse. The Government’s own figures show that from 2012 onwards there has been a huge decline in affordable homes being built, from 37,680 in 2012 to 10,840 in 2014. That brings it to a 20-year low.
Neil Coyle (Bermondsey and Old Southwark) (Lab)
My hon. Friend may be aware that my local authority, Southwark, is the largest landlord in London. In the previous Parliament, it was able to build more affordable homes than any other local authority, and it has a commitment to 11,000 new council homes in a welcome house building programme. However, the measures in the Bill would leave Southwark Council’s housing revenue account with a loss of £62.5 million by 2019-20, and in that year it would lose £28.2 million, with a knock-on effect on its ability to provide sufficient accommodation. I hope the Minister will commit to meeting my council to address those concerns, and I would welcome my hon. Friend encouraging him to do so.
Debbie Abrahams
As my hon. Friend rightly says, Southwark is the largest housing provider in London, and London faces particular issues.
Policy measures that have already been implemented have exacerbated the problems that we face on affordable homes. For example, the Government waived the mandatory quota for building affordable homes in new developments, which has further contributed to the poor quantity of affordable homes. The coalition Government allow developers to build more properties for rent in the private rented market, and by deregulating what was already the least regulated private rental sector in Europe, they open the door to rogue landlords.
The Government used £12 billion of taxpayers’ money to guarantee £130 billion of new mortgage lending in the form of the Help to Buy scheme. That has done little to help renters become buyers and homeowners. Instead, it has fuelled increases in new house prices and private sector rents, as many owners either sell or rent their properties as soon as the subsidies run out, and the increase in private sector rents has fuelled the increase in the housing benefit bill over the past five years. It has gone up from £4.4 billion in 2009-10 to £24 billion in 2014-15.
Neil Coyle
To further demonstrate the Government’s inability to understand the housing crisis in London in particular, is my hon. Friend aware that the Help to Buy scheme helped a very round number of people in the run-up to May 2015—an incredibly round number of zero—and that I have written to the Government to ask for improvements to the scheme? Unfortunately, no sufficient response was forthcoming.
Debbie Abrahams
My hon. Friend makes an important point. To be honest, I am not surprised. The Minister this morning was unclear about the rise in the housing benefit bill. As I was saying, it is up from £4.4 billion in 2009-10 to £24 billion in 2014-15—those are the actual figures. I know my hon. Friends will want to raise this point, but I will bring it up first: the number of people in work and claiming housing benefit has doubled to 1.1 million since May 2010.
Neil Coyle
Those people in work are also paying taxes. There seems to be some misunderstanding on the Government Benches about who pays taxes in this country.
Debbie Abrahams
Absolutely. The language used is sometimes unfortunate; it leads to a misconception that is commonly put out to the public arena. We all have an obligation to not mislead the public.
Extending the right to buy, which was mooted in the Tory party manifesto and set out this week in the Housing and Planning Bill, may increase homeownership —we all want to encourage homeownership—but without building more social housing, the extension will just reduce the supply of affordable homes for people on low income to rent. What will happen then? The average house price in the UK is more than £180,000. In London, it is more than £460,000. It has been estimated that it would take 22 years for people on low and middle incomes to save for a deposit.
I remind the Government of all the warm words from last week’s Tory party conference about helping people in poverty and with low incomes. There is a practical measure that the Government can take to do something about that, and I challenge them to do so. Housing is one of the biggest costs families face, and the Government’s plan will make the situation worse. Many young people, but not exclusively young people, are living with their parents or renting—the so-called “generation rent”. Inequalities are unfortunately increasing, not only in income but in wealth and assets, such as housing and land. Those inequalities, including the cost and availability of land, are key to addressing the housing crisis.
In addition to the effects of the plans on the building of affordable homes, there will undoubtedly be an impact on housing repair and regeneration programmes. The Local Government Association estimates that the loss in income from rent is equivalent to 60% of all local authorities’ total housing maintenance budget. That is significant. Ultimately, there will be an impact on both the integrity and the condition of the stock, and on maintaining decent home standards.
Peter Dowd (Bootle) (Lab)
Is my hon. Friend aware of any Government assessment of the medium to longer-term impact of the policy? If they denude associations of cash now, it saves the Government their £250 million or £300 million, but in the longer term, trying to claw back the lack of investment and denuding of the infrastructure might cost double or triple that.
Debbie Abrahams
My hon. Friend makes a valid point that needs to be driven home. There is such a poor evidence base to justify the policy. The Government have calculated the savings to the housing benefit bill, but the potential impact in other areas is significant. As a former public health consultant—I qualified in the ‘90s—I can remember the housing issues such as the need for rehousing on medical grounds, which was commonplace due to the poor quality of housing. A lot has been done to improve housing conditions though the decent homes programme and so on, and we do not want to reverse that. It would be particularly harmful to tenants, and particularly the young.
Naz Shah (Bradford West) (Lab)
Is the Minister aware that the measure will disproportionately affect certain housing associations in my constituency that cater for larger families? We have had the bedroom tax, and these measures feel like an extension of that sanction, which particularly affects more vulnerable people, such as women fleeing domestic violence. The Black Women’s Support Project in Bradford will suffer; I know because had a conversation with the chief executive, as I have served on the board in the past.
Debbie Abrahams
Again, my hon. Friend makes a valid point. Yes, there will be a small reduction in rent, which will be reflected in a reduction in housing benefit, but the cumulative impacts on individual families and in other spending areas will be considerable.
My point is that the measures will particularly affect the very young, the very old and people with existing health conditions and disabilities. As we anticipate, that is a logical consequence of reducing the maintenance budget, because the quality of housing will be affected. What assessment has been made? It is clear that the provision will push more households into the private rented sector, where there are currently 1.5 million families with insecure tenancies who could be evicted with as little as two months’ notice. Homelessness and rough sleeping have risen over the past five years, with 54,000 accepted as homeless, up 36% since 2010, and 920 families with children being illegally housed in bed and breakfasts for longer than six weeks because there is no affordable housing. That figure has risen by 820%. Again, how is it anticipated the measures will affect the homelessness figures?
Neil Coyle
On the point about homelessness, is my hon. Friend aware that in London since 2010, the number of former armed forces members sleeping rough has risen elevenfold, and does she agree that that heaps shame on the Government’s attitude towards those who have served in our country’s armed forces?
Debbie Abrahams
My hon. Friend makes a valid point. People whom we should be supporting after their service to our country are unfortunately finding themselves without a roof over their head. I say “unfortunately”; there are means to prevent it. The measure will stop the roll-out of the affordable homes programme and have an impact on armed forces personnel and people leaving care, who are more likely to need affordable homes. A whole host of people will be impacted.
What assessment has been undertaken of the viability of registered social landlords? I know that we will debate that when we come to a later clause, but given the risks that people already face, for example from the introduction of universal credit and the lowering of the benefit cap, housing associations have a genuine concern about how they will measure it in practice. I refer to one of my own local housing associations. I mentioned the £15 million reduction in income from rent; it will have to deal with that, including through redundancies and by rowing back on some of the programmes by which it hoped to upgrade accommodation. What assessment has been made of the risks being shifted to housing associations?
Amendment 21 would compel the Secretary of State to produce a plan within 12 months of the provision coming into force to offset the impact of the reduction in rent, so that the building of affordable homes is not affected. We are asking the Government to say within 12 months how they will stop the building of affordable homes being pared back, as the LGA and the NHF anticipate.
Peter Dowd
I am sure that my hon. Friend is not aware of this; I do not know whether the Minister is aware, but it would be interesting if my hon. Friend could check it out in due course. Riverside Housing Association, which is one of my local housing associations, estimates that the rent reductions will require an additional internal subsidy of £12,000 per home built for rent, and an additional internal subsidy of £12 million for the current programme—a 50% increase. Are the Government aware of the implications for building when they take that much money out of the system in one fell swoop? Do they seriously believe that that will not have an impact on housing in the medium term?
The Chair
Order. Before I ask the hon. Member for Oldham East and Saddleworth to continue her speech, may I say that the Minister will be on his feet later, so if Back-Bench Members wish to ask him aw question they will be able to do so directly?
Debbie Abrahams
Thank you, Mr Owen, for that clarification. My hon. Friend makes a relevant point, and perhaps he will ask the Minister directly.
Amendment 85 would require the Secretary of State to produce a report on the availability of accessible and supported housing. Finally, amendment 184 would introduce a sunset clause so that there would be no further reductions in rent after 2020. These things have a way of continuing, so we want to ensure that it is clear that the Government intend there to be no further rent reductions after 2020.
Mr Vara
I am grateful to the hon. Lady for the measured way she has approached the debate and presented the case for her amendments. I am grateful to her for moving amendments 21 and 85, because they give me the opportunity to set out clearly why we have put these measures in the Bill.
The housing benefit bill for England in the social sector now stands at £13 billion, having risen by nearly a fifth over the past ten years. Rising rents in the social housing sector are fuelling that increase, with average rent increases in the social sector more than double those in the private sector over the past five years. The Government are determined to put welfare spending on a sustainable footing and reduce the deficit while protecting the most vulnerable. We made commitments to deliver £12 billion of welfare savings, and the scale of the housing benefit bill means that we must address it, including through social rents, if we are to reduce the deficit.
Neil Coyle
The Minister’s concern for the rising rents in housing associations might be more welcome if it were married with concern for the rise in the private rented sector. Why is the Minister reluctant to address the concern of 70,000 private renters in Southwark and the steep rent rises they face?
Mr Vara
Let us talk about the private rented sector. In the years 2004 to 2014, the rent increase in the private rented sector was 23%, according to the Office for National Statistics. In the same period, the social housing rent increased by 63%. If that does not show that there is a difference, I do not know what does.
Emily Thornberry
I would be happy to take the Minister around Islington, where, I can assure him, the social rent levels are very much lower than private rent levels and the private rents are going up enormously. In my borough, we have great problems finding accommodation for people in the private rented sector if we cannot provide sufficient housing for them in the social rented sector, which we cannot. Our concern is that everything that the Government are currently doing is undermining the social rented sector and will, in the end, lead to a bigger benefit bill.
Mr Vara
I am grateful to the hon. Lady for her contribution, but I suggest she takes up the issue with the Office for National Statistics, rather than with me, as it is a highly regarded independent body. I am minded to say that the vast majority of the public will agree with the ONS, rather than with her.
Peter Dowd
May I ask for clarity? The whole point about the public sector is that it reinvests the money into new houses, new stock, decent homes and so on. The corporate group of the public sector tends to do that—it is part of its raison d’être—but the private sector is not doing it. Will the Minister give his view on that?
Mr Vara
I thank the hon. Gentleman for that contribution. I am mindful of the fact that he was a council leader before entering Parliament, and he brings added value to the Committee, and indeed the House, as a result. I will address the issue he has referred to and the argument that there will be a reduction in housing, so if he will please bear with me for a while longer, I will tell him why I believe that these measures will not have the impact that Opposition Members seem to think they will.
The Government have taken the decision to reduce rent increases within the social sector, which is good news for tenants. Just as I did on Tuesday, I pay tribute to the right hon. Member for East Ham (Stephen Timms), who acknowledged on Second Reading that the 1% reduction was a good thing and that he supported it. He is a distinguished Member of Parliament, and I am sorry that the Opposition Front Bench team has been deprived of the benefits he brought to it. He is a former Chief Secretary to the Treasury and a former Department for Work and Pensions Minister, and commands respect on both sides of the House. Given his ministerial experience, he knows the real position, and he said that he felt the 1% reduction was necessary. To be fair to him, he said he had concerns about the housing stock; I will address those concerns shortly, as I said to the hon. Member for Bootle. However, he recognised that the 1% reduction is necessary.
Rents paid by social housing tenants in England will reduce by 1% a year for four years from 2016. That means that by 2020 they will be paying roughly £12 per week less than they would have had to pay under the current policy of increases at a rate of the consumer prices index plus 1%. The policy will also help taxpayers, who are subsidising rents through the rising housing benefit bill. It is interesting that we have heard a lot of comments regarding housing associations, but no one seems to be acknowledging the financial benefit of £12 a week to the people living in those houses.
Jess Phillips (Birmingham, Yardley) (Lab)
To return to the Minister’s point about the benefit to the taxpayer, people living in lots of different types of supported accommodation, in social housing or in housing association housing are also in work and are taxpayers. I wonder how many times we will have to repeat that point to the Minister. They are not two distinct groups. Everybody pays tax, so will he please stop making out that one group of people is paying for another?
Mr Vara
The hon. Lady speaks of one group. The only conversations we hear are about the people she refers to; she does not talk about the people who are paying through their taxes for social housing but do not live in it. She speaks of a distinction she would rather I did not make—she would rather that we all spoke of just one group. She needs to recognise that there is another group. Perhaps she might reflect on those people occasionally.
Jess Phillips
Is the Minister telling me that the taxes of people who do not live in social housing are put in one pot and the taxes of people who do are put into another, and that those pots pay for different things? Am I confused, or is that money mixed?
The Chair
Order. This is a debate, and I am sure that the Minister will deal with the questions that have been raised.
The Chair
Order. I am conducting a Bill Committee at parliamentary level, and I am sure that the Minister will respond at that level.
Mr Vara
Absolutely, Mr Owen. I refer to all taxpayers, whether or not they are in social housing. All are equal in the contribution they make, but we must recognise that the taxpayer is paying a huge amount into the social housing budget at the moment. We have decided that a 1% reduction is fair. An argument has been put forward about there being inadequate housing; I will come to that shortly.
Mr Vara
A lot of questions were asked, and I would like to have the opportunity to address the issue of additional funds. I will give way to the hon. Lady in due course.
We need to recognise the £2.4 billion in surplus funds that housing associations have and the £2.2 billion that the 165 local authorities have in their housing revenue accounts. We should also remember the Government’s £10 billion debt guarantee scheme to support the delivery of new rental homes, and we are encouraging the supply of new homes with a £1 billion build to rent fund.
Mr Vara
I will not for the moment.
The Government remain committed to the delivery of 275,000 homes over the course of this Parliament. I remind Opposition Members that we have a track record of delivery—in the past five years we delivered more affordable homes than the Labour party did in 13 years of Government.
Several hon. Members rose—
The Chair
Order. The Minister is not giving way, and I would appreciate being able to listen to him without the conversations on both sides of the Committee Room.
Mr Vara
In England, only 75,000 homes were started between June 2008 and June 2009, the lowest level of building since the 1920s. So Government Members will take no lectures from Opposition Members when it comes to house building. They need to reflect on a whole host of other things—
Neil Coyle
The Minister used careful language—“most” and “many”—when talking about the financial robustness of housing associations. What distinction is made for those housing associations that are not in as strong a financial position? How will they be supported through a change that could see them lose significant sums?
Mr Vara
I appreciate that the hon. Gentleman is still reading the Bill, but when he gets further on he will find a subsequent clause that deals with exemptions, including local authorities or housing associations that might be in financial difficulty, and there are measures to deal with them.
To help further, the regulator will be on hand to assist housing associations in considering how they can deliver more efficiency and better value for money. My colleagues at the Department for Communities and Local Government continue to engage with all those concerned as they develop plans to meet the reductions. We acknowledge, however, that there might be some circumstances in which the reduction policy should not apply. Clause 20 therefore provides some statutory exceptions and for further provision to be set out in regulation. In clause 21 we have also allowed for circumstances in which the financial viability of a private registered provider might be jeopardised. In such circumstances a provider may apply to be exempt from the rent reductions; similar provision is made for local authorities.
As for the number of new homes being built, the Government remain absolutely committed to ensuring housing for those who cannot access the market, and we support the ongoing role that the housing association sector has to play in the supply of affordable housing, as well as driving more home ownership. There continues to be a role for housing associations in delivering the mix of housing supply that the country needs, as we have already seen with the delivery of 260,000 new affordable homes over the past five years. We are committed to delivering 275,000 homes by 2020.
We do not believe that there is a need for a plan or a report, as suggested in the amendments. Our approach is measured and will be good for tenants and taxpayers while building in safeguards for supported accommodation and the financial viability of private registered providers. On amendment 184, the Government have made a commitment to reduce rents for a period of four years from April 2016, which is made clear in clause 19 and the new schedule. I hope amendment 21 will be withdrawn.
Debbie Abrahams
The amendments have been drafted in consultation with a number of agencies, housing associations, the National Housing Federation and the Local Government Association. Moody’s has also criticised the Government’s measures. The Minister said that my right hon. Friend the Member for East Ham supports this measure, but he supports and has put his name to amendments 21 and 85.
Debbie Abrahams
Amendment 21 reflects the concern about the affordable homes building programme, which is why we have asked for a plan. We are not convinced that the Government will follow through, which is why I have moved the amendment.
On the other, more general points, I gently refer the Minister to the Government’s own data on house building performance, which were published this summer. Unfortunately, since 2010 the Government have presided over the lowest level of house building in peacetime since the ’20s—those are the Government’s own figures. I will not press the amendment but, again, I refer the Minister to the figures on affordable homes. We are really concerned about what is happening. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Neil Coyle
On a point of order, Mr Owen. I raised a point of order on Tuesday about a letter promised by the Minister for Employment. I now have a copy of the letter, for which I am grateful. There was clearly a mix-up, because it was sent some time ago. However, the letter does not answer the specific point about how the Government will assess the impact on disabled people in different areas.
On 17 September we discussed the impact on disabled people and carers and how to assess that impact more effectively. The Minister committed to providing an explanation of how that will be done. The letter I received talks about how Dr Simon Duffy has not responded to something for which the Department has asked—that is the block. I expected that the Department would outline what it is doing, not what it is not doing. I am keen to get more information on how the Government will address that.
The Chair
I have the gist of what the hon. Gentleman is saying. I was not in the Chair for the first point of order, and this is not a point of order for me. He has asked a question of the Minister, who is in her place. If she wishes to enhance what she said, she has the opportunity to do so, but he hon. Gentleman has his point on the record. We now need to move on.
Question put, That the clause, as amended, stand part of the Bill.
Mr Vara
I beg to move amendment 176, in clause 20, page 19, line 42, leave out paragraph (c) and insert—
‘(1A) Section 19 does not apply in relation to social housing that consists of or is included in a property if, where the property is subject to a mortgage or other arrangement under which it is security for the payment of a sum or sums—
(a) the mortgagee, or a person entitled under the arrangement to be in possession of the property, is in possession of the property,
(b) a receiver has been appointed by the mortgagee, by a person entitled under the arrangement to do so or by the court to receive the rents and profits of that property and that appointment is in force, or
(c) a person has been appointed under or because of the mortgage or the arrangement to administer or sell or otherwise dispose of the property and that appointment is in force.’
This amendment expands the exception from the rent reduction requirements in clause 19 so that it includes, as well as cases of a mortgagee in possession or a receiver appointed under a mortgage, cases where steps are taken under a different form of security to realise the security. See also amendment 177.
Mr Vara
The amendments relate to clause 20, which provides for an exception from the rent reduction requirements when a mortgagee takes possession of a property, or when a receiver is appointed by the mortgagee or the court, or where a property is sold by a mortgagee in possession or the receiver. This exception is intended to protect the value of stock held by all private registered provider landlords, to ensure that they can continue to use their assets as security for borrowing in the same way that applies in similar circumstances under the existing rent policy.
Our intention is that the rent reduction measures should be aligned as far as possible with existing policy on social housing, currently set out in the regulator of social housing’s rent standard guidance and the Government’s guidance for local authorities. Amendment 176 expands the exception from the rent reduction requirements in clause 19 so that it also includes cases where steps are taken to realise security under a different form of security, and where any person is appointed under a mortgage or different form of security arrangement to administer or sell the property.
Amendment 177 provides that the exception applicable to a sale by a mortgagee in possession or a receiver is not limited to the first person or body becoming successor in title of the registered provider on the sale or transfer of the property by a mortgagee or receiver, but extends to all subsequent purchasers or owners. It also expands the exception to cases in which the property is sold under a different form of security arrangement.
Amendment 149 clarifies that events for which the regulations may provide may include periods when the rent payable by a social tenant is temporarily reduced or waived. Such provision could be used to clarify how the rent reduction should apply when a registered provider has temporarily reduced or waived a tenant’s rent—for example, because they are making repairs to the property.
The details will be set out in the regulations. Without these amendments, there would be an impact on the private registered provider sector, potentially reducing the value of all social housing assets currently being used for security for borrowing, which would lead to a need for more security, and preventing them from borrowing more to build the homes that we need.
Debbie Abrahams
I should like to make a reference to my amendment, if I may.
Debbie Abrahams
In which case I will leave my remarks until then.
Amendment 176 agreed to.
Amendment made: 177, in clause 20, page 19, line 47, leave out paragraph (d) and insert—
‘( ) If a registered provider’s interest in property that consists of or includes social housing—
(a) was mortgaged or made subject to an arrangement other than a mortgage under which the interest in property was security for the payment of a sum or sums, and
(b) is sold or otherwise disposed of after the coming into force of section19 by—
(i) the mortgagee or a person entitled under the arrangement to do so,
(ii) a receiver appointed by the mortgagee, by a person entitled under the arrangement to do so or by the court to receive the rents and profits of the interest in property, or
(iii) a person appointed under or because of the mortgage or the arrangement to exercise powers that consist of or include the sale or other disposal of the interest in property,
section 19 ceases at that time to apply in relation to that social housing.”—(Guy Opperman.)
This amendment expands the exception so that, where there is a sale of a registered provider’s property by a mortgagee or receiver, the purchaser and all subsequent purchasers are excepted from the rent reduction requirements in clause 19. It also expands the exception to cases where the property is sold or otherwise disposed of under a different form of security.
Debbie Abrahams
I beg to move amendment 109, in clause 20, page 20, line 5, at end insert—
“(e) the accommodation is specified accommodation, as defined in the Housing Benefit and Universal Credit (Supported Accommodation) (Amendment) Regulations 2014.”
To provide that the mandatory 1% annual reduction in social housing rents will not apply to the tenants of “specified accommodation”.
I apologise for the confusion earlier, Mr Owen. Clause 20 sets out certain exemptions to the 1% reduction in rent for social housing providers, but the Opposition believe that there has been a major omission, which amendment 109 would address. It would include “specified accommodation” as defined in the Housing Benefit and Universal Credit (Supported Accommodation) (Amendment) Regulations 2014. I am grateful to Women’s Aid, Homeless Link, Sitra, Unison, St Mungo’s, the National Housing Federation, the Housing and Support Alliance, YMCA, Crisis, the Salvation Army and Centrepoint, which have all made a compelling case for the amendment.
Peter Dowd
Does my hon. Friend agree that Government policy on parity of esteem for people with mental health problems, which is trumpeted in relation to health, is not only about health, but about a range of social services, including housing? The Government proposal potentially directly affects parity of esteem for people with mental health problems.
Debbie Abrahams
Absolutely. My hon. Friend makes a powerful point. Those housing providers provide housing and support to a very vulnerable group, including people with mental health conditions. The measure will affect their opportunity and ability to live independently and well.
The impact on accommodation for homeless people with support needs demonstrates how damaging the change would be for supported housing as a whole. Over 90% of residential homelessness services rely on housing benefit as a key funding stream. One homeless organisation in the north-east of England has modelled the impact of the change on the 300 beds of supported accommodation that it provides, which accommodate 1,400 disadvantaged people a year. The impact of the 1% rent reduction, assuming that other costs increase by 2% or 3% a year, is that 50% of its accommodation projects will be financially unviable in 2016-17. It is absolutely imminent. That is key. The pace of the clause’s implementation means that we will be facing problems in the next few months and I hope the Minister responds appropriately. It gets worse, I am afraid: the organisation has mentioned 100% financial unviability by 2017-18. What will happen to that vulnerable group of people?
A second organisation, St Mungo’s Broadway, provides accommodation support to 3,800 people each year across London and the south-east of England. I have visited the project here and in the midlands. St Mungo’s estimates that the 1% annual rent reduction requirement will result in it losing £1.25 million in rental income by year 4—between £250,000 and £300,000 each year. Taking into account the rental income that the organisation anticipates over that period, the overall impact on its finances over the four-year period is a loss of £4 million. That loss of income will force some projects to close, resulting in the loss of accommodation for homeless and disadvantaged people.
Mr Owen, I expect that you have experienced an increase in rough sleeping in your constituency. I was shocked recently, in the last month or so, when I arrived back in Manchester from Parliament late one night. Every 50 metres there was somebody sleeping rough. The fact that the measures will affect organisations such as St Mungo’s is serious. I have mentioned the groups of people supported by those housing providers. The providers have estimated who will be affected in percentage terms. They expect that people with learning disabilities and physical health problems, people who have slept rough and people with a history of offending, and people with alcohol, drug and mental health problems who have been accessing their services for support needs, will be affected.
As has been mentioned, the measures will have an enormous impact on services working with other disadvantaged people. A large national provider of supported housing has estimated that the change will lead to the loss of 104 schemes, removing 1,969 support spaces for clients, including 228 spaces for people experiencing domestic violence. A small specialist learning disability provider will have its operating margins reduced to 0.2% and will be forced to cancel all proposed development of learning difficulty schemes. A large national organisation will be forced to reduce planned development of extra care by 400 units, including units specifically to help people home from hospital. Such organisations reduce the pressures that our beleaguered NHS is experiencing—the measures will have a direct impact on the NHS.
There is a precedent. The principle of treating supported housing separately from other social housing for welfare reform purposes was recognised in the previous Government’s proactive decision to keep housing costs for specified accommodation out of universal credit and the benefit cap calculations.
Jess Phillips
Does my hon. Friend want to pay credit to Ministers for removing specified accommodation during the previous Government? It most certainly meant that, at the refuge where I worked at the time, we could maintain operations exactly as they were, and in fact develop some others. The Minister spoke earlier about listening. Perhaps we should pay credit to the Government for listening on that occasion.
Debbie Abrahams
My hon. Friend is absolutely right. That is a valid point, and I hope the Minister can do so. On that note, I will stop there.
Neil Coyle
In rising to speak to the amendment, I just want to say that I welcome the Minister’s commitment this morning to write to me so I can find out a bit more information. He suggested that I was trying to make a name for myself—I believe that was the term he used. I certainly do not intend to upset him in any way, not least because I understand he has a black belt in martial arts.
Neil Coyle
The commitment to providing information was linked to the amendment because we were talking about housing associations, representations and the discussions that the Department is having. It would be useful if the Minister, when answering in writing, could provide information on the number of housing associations that have been met; the numbers that indicated that they support the policy, especially those providing specified and supported accommodation; those that specifically outlined the risk to their business case of the policy going ahead; and any representations to the Department from organisations suggesting that they would be unable to provide specified accommodation. I would be grateful to receive that information. I do not expect an answer today.
We heard about specified accommodation in great detail from my hon. Friend the Member for Oldham East and Saddleworth, and from all the organisations that made representations—I am particularly grateful to Homeless Link, St Mungo’s Broadway, Shelter and Crisis. The amendment is designed to cover shared houses, hostels, refuges and self-contained accommodation owned by registered providers, and instances where housing-related support, including financial management, is provided.
St Mungo’s Broadway operates in my constituency. Of its residents—the people that it provides support to—52% have previously been rough sleepers, 72% have mental health needs, 44% have significant physical health problems and more than one in five have experienced violence or abuse from a family member or partner. That is the client group, to use the Department’s language, that we are talking about. The total number of units provided at the moment is around 105,000. My hon. Friend the Member for Bootle mentioned Riverside, which estimates that it provides about 4,600 units of that kind of accommodation. We are not talking about a huge number, but the measure would make the provision of the services and housing more difficult for those organisations.
The Homes and Communities Agency was mentioned earlier. It has estimated that investment in supported housing results in a net cost-benefit to the public purse of £640 million per year. Does the Minister have any information about how that cost-benefit analysis has been undertaken or about the risk to that cost-benefit if housing is put at risk? The cost to local authorities of rough sleeping is roughly £8,600 per person. That does not include any cost to the Department of Health, the Ministry of Justice or the Home Office—it is just the cost to local authorities. Getting this wrong and putting accommodation for vulnerable people at risk could have knock-on costs for all taxpayers.
The Department for Work and Pensions and the Department for Communities and Local Government have commissioned a review into supported accommodation to establish a better evidence base for future funding decisions. Would the Minister give an indication of where that review is at and why the Government are not prepared to wait for the outcome of that review before pressing on with the policy?
Riverside estimates that the cumulative cost of the policy to it would be about £100 million. It has said that
“a year on year reduction in rental income would make this element”—
the specified accommodation—
“of our business loss making”.
It would either have to subsidise from elsewhere or stop providing that accommodation.
St Mungo’s Broadway has said that
“the requirement to reduce rents in social housing in England by one per cent per year for four years will result in the loss of supported housing schemes for homeless and vulnerable people.”
It is saying categorically that it will be unable to provide some of the accommodation that it currently provides, and that there is a knock-on cost that the Government have not taken into account. As my hon. Friend the Member for Oldham East and Saddleworth has mentioned, St Mungo’s Broadway has said that it will lose £1.25 million by the end of this Parliament as a result of the annual rent reduction. The four housing associations that I have spoken to, which provide some of their accommodation in Bermondsey and Old Southwark, have said that collectively, the cost to them of the proposed policy would be more than £180 million during the lifetime of this Parliament alone.
Mr Vara
May I initially address the hon. Gentleman’s points, although I will of course write to him? As a caveat, I must say that we have lots of meetings with lots of organisations, and many have asked whether we could look at something differently. Policy is not reached purely on the basis of asking, “Do you agree with this, or don’t you?”. Instead, we make it clear that we propose to do something and that we have a Government mandate to do so, and we ask how we can do that so that we best accommodate others’ views. Matters are not clearcut, but I will certainly write to the hon. Gentleman.
The hon. Gentleman referred to the evidence review that the Government have commissioned on the specified accommodation and supported housing sectors to understand better the scale, shape and cost of the sector in England, Scotland and Wales. We hope that the findings will be available sometime next year.
I welcome the contributions to the debate, all of which have been heartfelt. I commend the hon. Member for Oldham East and Saddleworth for the measured way in which she put forward her arguments, and I have taken her points on board. I am very grateful that the amendment was selected, because it gives me the opportunity to set out what is in the Bill, and to explain why we cannot support the amendment. However, I hope that the hon. Lady will take comfort from my remarks.
We recognise that the rent reduction measures introduce a significant change to existing rent policy. We have listened to comments and concerns about the housing of vulnerable groups, and I can offer the hon. Lady a number of assurances that mean that her amendment is unnecessary. First, in the light of this new policy, we will look to align as far as possible exceptions under the new policy with those that apply under the existing rent policy for social housing. That means that we intend to except from the rent reduction requirement the types of housing that are excepted from the rent standard. Those include specialised supported accommodation, which provides support for the most vulnerable people and which is developed in partnership with councils or the health service. Also excepted will be residential care homes and nursing homes. Clause 20(2) gives the Secretary of State for Communities and Local Government a power to set further exceptions should they be needed, to except that accommodation from rent reductions.
Clause 20(3) further clarifies the cases and circumstances that regulations may provide for, which include groups of tenants and types of accommodation.
Peter Dowd
I acknowledge what the Minister is saying, but I would ask him to cast the net more widely. For example, does he recognise that, under section 117 of the Mental Health Act 1983, if accommodation cannot be continued, provision becomes much more expensive because of a statutory requirement, notwithstanding the forthcoming amendments? That provision would be much more expensive if organisations could no longer provide it. The Government are taking money from Peter to pay Paul, but Paul is much more expensive.
Mr Vara
I take on board what the hon. Gentleman says, some of which I will address later when I talk about other forms of help, assistance and funding.
We have tabled amendments that provide the Secretary of State with powers to allow, by regulation, rent setting for new tenancies in supported housing at up to 10% above the formula. That is similar to the existing rent policy and standard practice. We believe that should help providers of supported accommodation for vulnerable people to continue to provide that important housing. We also acknowledge that there might be some circumstances in which the financial viability of a private registered provider or a local authority could be jeopardised—something the hon. Member for Bermondsey and Old Southwark mentioned. In those cases, the providers could apply to be exempt from rent reductions.
Neil Coyle
It sounds like some of what the Minister is saying is likely to be welcome. Let me reiterate that the borough of Southwark is the biggest landlord in London. In bringing forward other exemptions, would the Minister be willing to meet my local authority to ensure that the most appropriate accommodation is exempted to best effect?
Mr Vara
I would of course be happy to meet the hon. Gentleman and anyone he wishes to bring to the meeting. What I would say is that we have been mindful of the fact that we cannot judge the situation as it is now. Where local authorities or housing associations find themselves in financial difficulty and their viability may be an issue, there are processes in place to ensure that the regulator works with them to make sure that things can be worked out. If it is felt necessary, then with the consent of the Secretary of State there can be alterations through a rent reduction, and organisations can make their case. However, we hope to set out in regulations the criteria that would be applied.
We intend to work with organisations—housing associations and local authorities—because we want to make this work. The change is not simply being imposed; we are consulting widely. The hon. Member for Oldham East and Saddleworth was right to say that there have been a number of amendments, and I repeat that that is a direct consequence of lots of organisations coming to us and saying, “Well, how about this?” We have taken what I think is a commendable decision, in that we have genuinely listened and tried to clarify what we thought we were aiming for. It was not clear enough for the people concerned, so we sought to clarify it.
It is important to get the balance right between reducing the burden on taxpayers and supporting the provision of housing for vulnerable people, as well as the balance between supporting the provision of that housing and treating fairly those older or disabled tenants who pay their own rent and who should benefit from the rent reductions, but will not do so if there is a blanket exemption.
When it comes to dealing with vulnerable older and disabled people, it is important to look at the wider context. As a Government, we are determined to protect the most vulnerable in society and help them to live independent lives, and assistance goes beyond what we are discussing today. Funding for supported housing is included in the wider settlement to councils. The Government continue to support local areas to meet their local needs by maximising funding flexibility. For example, in 2015-16, we are investing £5.3 billion in the better care fund to deliver faster and deeper integration of health and social care. This will enable councils to invest in early action to help people to live in their own homes for longer and help to prevent crisis, as well as supporting councils to work together more effectively, deliver better outcomes for less money and drive integration across all services.
The Government are also investing in specialised housing for older and disabled people through the £315 million care and support specialised housing fund. Phase 1 is expected to deliver over 4,000 homes by 2018; phase 2 was announced in February and will set aside up to £155 million in capital funding for the development of specialist housing to meet the needs of older people and adults with disabilities or known mental health issues.
Neil Coyle
My understanding is that the better care fund is entirely restricted to new projects, so it cannot help towards councils’ existing accommodation costs. Given that we know the waiting lists that councils across the country have, I am not convinced that the better care fund is the solution to the specific problem before us. At the same time, the Government are ending the independent living fund, leaving councils potentially significant new costs for providing residential care accommodation for disabled people who had previously been able to be supported in their own homes.
Mr Vara
I repeat that we should not look at this solely in the context of what we are discussing today; there is a wider picture here, and I have given details of the other moneys available alongside the 1% reduction we are discussing.
I repeat that the Government are committed to ensuring that the most vulnerable people are protected. Statutory homelessness is lower now than in 26 of the past 30 years, at less than half the peak it reached in 2004. This Government have increased spending further to prevent homelessness, making over £500 million available to help the most vulnerable in society. That has resulted in local authorities preventing 935,000 households from becoming homeless since 2010.
Neil Coyle
There is a brilliant charity in Bermondsey called UK Homes 4 Heroes, which supports former members of the armed forces. We have seen a dramatic rise in the number of former members of our armed forces sleeping rough in London. How will this specific policy help councils and others to better support those coming out of the armed forces, to prevent them from ending up sleeping rough, given what the Minister has just said?
Mr Vara
That issue commands huge respect across Government and on both sides of the political argument. There is discussion and debate across Government to make sure that brave men and women who are prepared to put their lives on the line for our safety and security get the best possible treatment. There are clearly still issues that need to be resolved. It is an ongoing debate. I am very aware of the situation to which the hon. Gentleman refers; there are RAF bases in my constituency, and I am only too aware of how we need to look after those people a lot better. We have made progress in the past five years, but we need to do more and should remain vigilant.
I believe that there are sufficient safeguards in place to ensure the continued financial viability of housing providers while balancing the need to support tenants who should benefit from a reduction in their rent. I urge the Opposition to withdraw the amendment.
Debbie Abrahams
I am grateful to the Minister for that positive response and look forward to the regulations he mentioned setting out the criteria on requests for exemptions that providers of supported housing may put to the regulator. I believe that the Minister recognises the dire situation those providers are in. I also thank my hon. Friend the Member for Bermondsey and Old Southwark, who provided us with the wider context about, for example, how the end of the independent living fund will affect local authorities’ provision for supported accommodation; that is very relevant.
I differ from the Minister in my interpretation of the homelessness situation at the moment. We can trade off figures, which I do not think is helpful. We need to move beyond that. I have the Government figures here, and in the past five years, for example, there has been an 840% increase in the number of families with children who have been declared homeless and are living in bed-and-breakfast accommodation. The situation is certainly not rosy. We have anecdotal evidence of that ourselves. However, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Chair
With this it will be convenient to discuss Government amendments 155, 156, 161 and 162.
Mr Vara
We have recently been talking about exceptions and exemptions and it might be helpful if I clarify the position. We will set out the criteria for exceptions in the regulations. When we talk about exemptions, the financial viability conditions are in the Bill. We can also set out other conditions for an exemption in the regulations. I hope that that is helpful in drawing a distinction.
The amendments seek to introduce flexibility into the exemption process in relation to clause 19. Amendments 154 and 161 allow a direction to be made in relation to only some of the social housing that a private registered provider or a local authority have, ensuring that exemption can be targeted. Amendment 155 enables the regulator of social housing, the Homes and Communities Agency, to publish guidance on steps that a private registered provider should take before seeking an exemption. Amendments 156 and 162 give the Secretary of State power to prescribe conditions other than serious financial difficulties in which an exemption may be granted to a local authority.
Amendment 154, 155 and 161 recognise that exemption is a tool of last resort and, if needed, should be used in as targeted a way as possible. Amendments 156 and 162 provide for greater flexibility in the exemption regime.
Debbie Abrahams
I am grateful to the Minister for his clarification. We are talking about the financial viability of supported housing providers and, more broadly, housing associations. The Government are considering the problems that they face, so has there been any assessment of the housing providers whose viability could be threatened as a result of the measures? Will one be undertaken? I am grateful for the detail on the amendment, but it seems that implementation is already anticipated. Should there not be a step before that?
Mr Vara
We are not anticipating difficulty. We are trying to recognise what might happen in future, so we are making it absolutely clear that, although we propose a 1% reduction, where financial viability is threatened, there are measures in place to deal with it.
We must recognise that the regulator is there to help, assist and advise. Its job is to assist, but as a default mechanism we have those provisions. However, as far as I am aware, we do not anticipate anyone having difficulty. I reiterate that we are confident that housing associations and local authorities are robust organisations that can deal with the 1% reduction. It must be considered in the wider context. Individuals and other organisations throughout the country are having to put up with difficulties. We are asking for a 1% reduction. I repeat the comments made by David Orr, chief executive of the National Housing Federation. I will not repeat the whole quote, as I gave it earlier, but simply two lines. He said that
“in truth, there is no sector anywhere that is not still capable of making further efficiency savings. That is as true in our sector as it is anywhere else.––[Official Report, Welfare Reform and Work Public Bill Committee, 15 September 2015; c. 91, Q144.]
Amendment 154 agreed to.
Amendments made: 155, in clause 21, page 21, line 11, at end insert—
“( ) The regulator may publish a document about the measures that the regulator considers could be taken by a private registered provider to comply with section 19 and to avoid jeopardising its financial viability.”
This amendment enables the Regulator of Social Housing to publish documents relating to the condition in clause 21(4).
Amendment 156, in clause 21, page 21, line 13, after “(9)” insert “or (9A)”.
This amendment and amendment 162 provide that the Secretary of State may issue a direction if an alternative condition is met, that is, a condition that the circumstances of the local authority must satisfy requirements prescribed in regulations by the Secretary of State.
Amendment 157, in clause 21, page 21, line 18, after “for” insert ““at least”.
This amendment and amendment 158 permit a local authority to which a direction in the terms of clause 21(7)(b) is issued to make a reduction in rent, instead of keeping the rent the same.
Amendment 158, in clause 21, page 21, line 19, for “the same as” substitute “no more than”.
Amendment 159, in clause 21, page 21, line 21, after “required” insert “at least”.
This amendment permits a local authority to which a direction in the terms of clause 21(7)(c) is issued to make a greater reduction in rent than the reduction specified in the direction.
Amendment 160, in clause 21, page 21, line 22, at end insert—
“(d) a direction that section19 is to have effect in relation to a local authority specified in the direction as if section19(1) required the authority to secure that the amount of rent payable by tenants of their social housing increased by no more than the percentage specified in the direction.”
This amendment provides for directions that exempt a local authority from the rent reduction requirements in clause 19 but limit what increase in rent the authority may impose.
Amendment 161, in clause 21, page 21, line 24, at end insert—
“, and
(b) the social housing in relation to which it is to have effect.”
This amendment enables a direction to affect only some social housing of a local authority.
Amendment 162, in clause 21, page 21, line 27, at end insert—
“(9A) The condition in this subsection is that the circumstances of the local authority satisfy requirements prescribed in regulations made by the Secretary of State.”
Amendment 179, in clause 21, page 21, line 31, leave out subsection (11).—(Guy Opperman.)
This amendment is consequential on amendment NC22.
Question put, That the clause, as amended, stand part of the Bill.
Priti Patel
It is a pleasure to serve under your chairmanship this afternoon, Mr Owen.
The amendments are about fairness for taxpayers. Currently the Government divert benefit payments to Motability Operations Ltd on behalf of claimants who participate in the Motability scheme. That is of direct benefit to Motability Operations Limited, but the cost of doing it is borne by the taxpayer. The new clause seeks to rectify that by granting the Government the power to recover the expenses incurred in the administration of that arrangement and any similar future arrangement in respect of benefit diversion to an organisation that leases or sells motor vehicles to disabled persons.
Amendment 130 will enable the Government to exercise the power in England, Wales and Scotland. The power will not have an impact on customers. It will merely allow the Government to recover the expenses incurred in diverting the benefit. It has the support of Motability.
Debbie Abrahams
New clause 14 and amendment 130 make provision for the Department to recover costs made in administering the payments to relevant providers for the lease or hire-purchase of motor vehicles for those in receipt of the higher rate mobility component of disability living allowance or the enhanced mobility component of PIP.
Currently, around 620,000 people lease vehicles through the Motability scheme for an average of £3,000 a year over three years. Concerns have been expressed about the number of people who previously qualified for the higher rate mobility component of DLA, but who failed to qualify for the enhanced rate of the mobility component of PIP and so no longer qualify for the scheme. As the Minister is aware, about 360,000 current Motability scheme users will be reassessed between October 2013 and 2018.
What assessment has the Minister made of the numbers of people who to date will no longer be eligible for the Motability scheme? In addition, will the Minister inform the Committee of the cost to the Department of administering payments to providers, as outlined in the new clause? Will she estimate how much per lease the recovery of DWP expenses will cost? Furthermore, what estimate has she made of the recoverable expenses as a percentage of the overall average leasing or hire-purchase agreement? When will the Government produce an impact assessment for the provision?
I am sure we all recognise the importance of the vehicle-hire schemes to disabled people, and of the benefits that the independence of having a suitable vehicle brings in health, social, work and financial terms. My father-in-law was registered blind and, through a mobility scheme, my mother-in-law was able to drive him around. The independence that that gave him was very important to him.
Opposition Members would welcome the Minister’s assurance that the changes outlined in new clause 14 and amendment 130 will not negatively impact on a disabled person’s ability to secure access to vehicle leases and rental agreements, and the independence and the lifeline that they provide. We would also like assurances that there will be no further shifting of costs to disabled people.
Priti Patel
I have a number of points, and I will come back to the hon. Lady specifically on quantity information and data. The measure has the support of Motability, and working with Motability is the right thing to do because Motability Operations Ltd provides great support for claimants. She makes it abundantly clear that a great deal of vital and valuable support is provided. This is a valuable lifeline to claimants.
The hon. Lady mentioned costs. I have some figures. The measure costs less than £1 million a year, and Motability has confirmed that it is affordable and will not have an impact on its users. She has specifically asked for further information, and I will ask officials in the Department to get back to her.
Neil Coyle
I welcome the Minister to her place. It is interesting to hear that Motability supports the amendment. Does the amendment arise from the expectation advertised by Motability that it will be forced to withdraw vehicles from disabled people as a result of the transition from disability living allowance to the personal independence payment?
Priti Patel
My understanding is that there will be no impact on claimants who participate in the scheme. The measures are about ensuring the service and reclaiming costs in a fair way for taxpayers, as I explained in my initial comments. This is not about service provision changes. I hope that answers the hon. Gentleman’s question.
Question put and agreed to.
Question put, That the clause be added to the Bill.
The Chair
With this it will be convenient to discuss:
New clause 18—Review of Disability Living Allowance and Personal Independence Payment—
‘(1) Part 4 of the Welfare Reform Act 2012 (Personal Independence Payment) is amended as follows.
(2) Insert new section after section 79—
“79A Review of Disability Living Allowance and Personal Independence Payment
(1) The Secretary of State shall in each tax year review the standard rate and enhanced rate of the daily living (section 78) and mobility component (section 79) of the personal independence payment.
(2) In carrying out a review under subsection (1) the Secretary of State shall consider the effect on the rates if they were increased by—
(a) the percentage increase in the general level of earnings at the end of the period;
(b) the percentage increase in the general level of prices for goods and services, as measured by the Consumer Price Index or by any measurement formally replacing the Consumer Price Index; and
(c) 2.5 per cent.
(3) The Secretary of State shall within three months of this review concluding lay before Parliament a draft order which increases the value of the amount referred to in subsection (1) by the greatest of the three amounts calculated under paragraphs (a) to (c) of subsections (2).”’
For DLA and PIP to be triple locked to further protect their value.
Neil Coyle
Thank you, Mr Owen. That was a bit of a surprise; I thought that there were more Government new clauses to get through.
I pay tribute to my hon. Friend the Member for Sheffield Central (Paul Blomfield) who supported the drafting of the new clauses. I also pay tribute to the citizens advice bureau that serves Sheffield Central and Sheffield, Brightside and Hillsborough for providing case studies. As the explanatory statement makes clear, the new clause is designed to improve support for disabled people who become terminally ill when they are already in receipt of DLA and are in the process of being transferred to the PIP. Welfare rights advisors have identified delays in support to that group. Are the Government were willing to address the concerns?
Today, we heard the Government again suggest that they are protecting disabled people and the most vulnerable. My new clause is solely concerned with terminally ill disabled people—people with an existing impairment or health condition and a terminal prognosis of six months or less left to live. It is very small group. On September 9, I asked the DWP for the specific number of people on DLA who would be affected by the measure. The answer I got back was disappointing—it was not from the Minister, but one of her colleagues. The answer was that the information on the number of disabled people affected by the issues “is not collated” by the Department
“and could only be provided at disproportionate cost.”
That was an incredibly disappointing response, not least because the DWP publishes PIP statistical ad hoc reports.
The most recent figures from May 2015 on registrations, clearances and awards indicate how many people within the figures might qualify for support. As of 31 March 2015, 774,800 new PIP claims and 123,700 DLA reassessment claims had been registered. For the entire period of PIP, the number of reassessments under the
“special rules for the terminally ill”
—to use departmental language—was 16,000. To put a figure on it to enable the Government to cost the measure, we are talking about just 800 people a year, roughly, who are disadvantaged by current process and would benefit slightly from a more sympathetic position from the Government. Those are purely disabled people who are on DLA and moving to PIP due to terminal illness. The new clause is designed to ensure that they receive their first PIP immediately instead of waiting four weeks from the final DLA payment and another four weeks before receiving their first PIP. When people are terminally ill, time is more pressing and precious, and that is a ridiculous amount of time to wait to receive support. That length of time was not required by the former DLA rules, under which the payment would have been received far more quickly.
In the welfare rights advice sector, the perception of the coalition Government’s welfare reform legislation is that it was an accident, rather than a deliberate policy designed to delay support for terminally ill disabled people. Will the Minister indicate whether making terminally ill disabled people wait longer to access vital support was an intended outcome of the change under PIP?
Citizen’s advice bureaux throughout the country have been working as part of the big society—we do not hear so much about that any more. In Southwark, those services have seen a 40% jump in demand. Their support for society has got far bigger as a direct result of welfare reform. I am grateful to the citizen’s advice bureau in Sheffield for providing information about Carol. Carol is 59 and was in receipt of the DLA care component at the lowest rate of £21.80. On 27 May this year, following a diagnosis of metastatic breast cancer, she notified the DWP that she wanted her claim reconsidered under special rules. The Department awarded her the highest rates of the daily living and mobility components of PIP, which equates to £139.75 a week. However, due to the application of transitional rules, payment was from 8 July—four weeks after her next DLA payment date. Had she been a new claimant for PIP who was not already in receipt of DLA the benefit would have been awarded from 27 May. In Carol’s case, that meant losing £117.95 a week for the period of 27 May to 8 July. Some claimants in similar situations would simply not live long enough to receive their awards under existing rules.
I must ensure that I anonymise the next example, as I do not believe that I have permission to name the individual. C1 was diagnosed with terminal lung cancer. He has chronic obstructive pulmonary disease and has had his right leg amputated below the knee. He received the DLA higher-rate mobility and lower-rate care payments. C1 was told that he could claim PIP instead of DLA but would then be entitled to enhanced care as well as higher-rate mobility. His PIP would not increase until four weeks after his next DLA payment date, so it might take four to eight weeks for the increase to take place, despite his significant disadvantages and terminal prognosis. On the date the advice was given, the client would not have been entitled to receive the enhanced rate until 30 September. He was given the advice in August. The individual has agreed to allow his story to be put forward, and he is happy for us to discuss his circumstances, but not to be named. However, it is a genuine example from Sheffield.
Peter Dowd
I support my hon. Friend and new clause 4. The Under-Secretary of State for Work and Pensions, the hon. Member for North West Cambridgeshire, talked earlier about a wider context, and I want to talk in a wider context now. Not many weeks ago we debated the Assisted Dying Bill—many people in this room were there. I suspect many Members, like me, voted against that Bill. We said it was a question of giving people dignity in death and as much support as possible in the weeks and months leading up to their death. The new clause would go a long way to helping with that concept, because we can have the abstract idea of supporting people who do not think people should be assisted when they are dying, but the new clause is a practical step to help those who voted against the Assisted Dying Bill to put that into effect.
We recently had a discussion about the hospice moment. I wrote an article about the movement in which I said it was part of the wider context and the wider support that we give in society to people who are on the doorstep of death—let us not beat about the bush, that is exactly what it is. The new clause is a practical proposal to help such people.
For those of us who have had a relative or a friend with a terminal illness, or for those who have worked in the sector and had to deal with people with a terminal illness, the new clause would provide reassurance. It would reassure me that I could be part of the process of saying, “Yes, we have helped you. It might be minor in some regards, but we have been able to help you in your last days and weeks.” That would take some of the stress from the family, and it might take some of the stress from the dying person as well. It is important that we play a part, even if we in this room can play only a small part.
There is another aspect. Some people with a terminal illness might have co-morbidity. They may have Parkinson’s disease; indeed, they may have Alzheimer’s. In those circumstances, it is incumbent on us to make sure that we link the abstract with the practical. This is a genuine opportunity to link our abstract principles and philosophy— on assisted dying, for example—with the practical implications.
Neil Coyle
I also attended the debate on the Assisted Dying Bill, and there was a strong consensus that there was insufficient support for those who are dying or contemplating suicide. It is unfortunate that, even where there is an indication that some cuts in support have contributed towards tragic consequences for individuals, the Government are reluctant to analyse that properly and to prevent that from happening—not for any other purpose, but to ensure support to prevent people from taking their own lives and to support people at the end of their lives.
Peter Dowd
That is a well-made point. The more we get into this debate, the more we have to move from the philosophical and the abstract to the practical. This is a practical example of where we can say to people, “You’ve got so many pressures on your life at the moment, the least we can do is try to take away just a little of the pressure on you and your family.” If we can just do that, it would be a small step, but a great achievement.
Priti Patel
Let me start by thanking the hon. Members for Bermondsey and Old Southwark and for Bootle for their contributions, and particularly the hon. Member for Bermondsey and Old Southwark, who has experience in this area from his professional background. For the record, I also thank the third party organisations that have submitted written statements to the Committee and its members. The hon. Gentleman gave some examples—not attributable ones—but I repeat my offer to the Committee: if there are cases that he or any other member would like me to look at, I would be happy to do that and to meet them to give support and assurance.
New clause 18 seeks to create a duty to increase the rates of disability living allowance and PIP by the highest of the CPI, the rise in average earnings or 2.5%. DLA and PIP are benefits that offer support, as we have heard, for those needing care or supervision as a result of their disability. New clause 18 would require the Secretary of State to review those rates every tax year, considering the effect on them if they were increased by earnings, prices or 2.5%, and, within three months of concluding that review, to lay an order increasing them by the highest of earnings, prices or 2.5%.
Making this change to the Welfare Reform Act 2012, rather than to the Social Security Administration Act 1992, would create a second review process of DLA and PIP rates, which would overlap with the general review of benefits conducted by the Secretary of State every tax year. That would create uncertainty for benefit recipients, who may find their benefit rates reviewed and announced at different times. Furthermore, the change would remove the alignment between the rates of the care components of DLA and the daily living components of PIP, and those of the attendance allowance, causing further confusion for recipients between working and pensioner age.
This discussion has been highly relevant, however, because we all understand and share the desire of hon. Members who have contributed to the debate to protect and to support those in receipt of DLA and PIP. That is why we have in place many protections, which I would like to set out. We already continue to uprate DLA and PIP by price inflation; specifically, we have exempted certain benefits relating to the additional costs of disability and care from the benefits freeze. Those include DLA and PIP, as well as carer’s allowance, attendance allowance and the support group component of ESA. We have also exempted recipients of DLA and PIP from the benefits cap. The welfare system continues to provide support and to protect those recipients. As we have heard, there are families who cannot work and require the support of DLA and PIP, which is why we have these exemptions. We have also ensured that both DLA and PIP remain universally accessible benefits and have committed not to means-test either. We have also committed to keep them non-taxable. We have built extra protections into the system for claimants who may need extra support.
That brings me on to new clause 4. During the course of our welfare reform programme, the Government have always made it clear that, in our steps to achieve a higher-wage, low-tax and low-welfare society, we will always provide support for those with the greatest needs. In particular, PIP recognises the unique challenges of claimants who are terminally ill. Special rules and criteria for the terminally ill have been introduced to ensure that the PIP system handles such cases both efficiently and sensitively to reduce burdens on individuals and their families at what is inevitably a difficult time. PIP has a fast-track system to allow us to process special rules claims more quickly, with claims, on average, being cleared within six working days. Some 99% of those who apply under the special rules are awarded the benefit, and we have ensured that each of those individuals is guaranteed the enhanced rate of the daily living component.
Evidence for special rules cases is reviewed on a paper basis, and we do not expect individuals applying in such circumstances to undertake any face-to-face assessments. We have worked closely with stakeholder organisations to design a system that allows us to make the correct decisions in such instances without the need for a face-to-face assessment, thereby reducing intrusion and stress for claimants and families. It also helps us to deliver vital support for claimants in the most practical way as soon as possible.
In many cases where an individual may not be aware of their prognosis, or where that might be a particularly distressing subject to discuss, we have worked to design the system to support family members, or representative third party organisations, through the claims process to ensure that individuals can still access the support to which they are rightly entitled in a way that is sensitive to their needs. Through those steps, we have a clear focus on delivery for the individual. It is also important that case managers still have sufficient time in which to consider an individual’s case to ensure that they are being awarded the correct level of support and benefits. Reducing that time, as suggested, would potentially increase the risk of an incorrect payment being made. In such cases, the claimant would either be left with less support or little support. Obviously, we want to ensure that we are not creating any arduous or difficult processes. We are focused on supporting individuals.
Debbie Abrahams
Will the Minister clarify that point? My hon. Friend the Member for Bermondsey and Old Southwark has said that that happens automatically in the current DLA system. It happens in the DLA system, but not in the PIP system. Why would there be an issue if it is transferred to the PIP system?
Priti Patel
As I have just said, that would undermine its value. The best way to put this is that, importantly, it is about the individual and ensuring that we have the right rules so that we can support the individual in the right way.
Neil Coyle
It is a bit disturbing to hear the Minister worrying about an inappropriate payment, because she is suggesting that the Department cannot handle this issue. It already handles the issue through disability living allowance so that people get the support when they need it. A very small number of people are moving from disability living allowance to the personal independence payment—we are talking about a maximum of 800 people a year, according to the Department’s figures. We are talking about a very small number of people and a change that aligns the support with DLA for those people in the DLA to PIP transition areas.
Priti Patel
I completely understand those points. The focus is on ensuring that PIP is delivered in the right way and providing the right support. Having listened to the debate today, I will happily consider the views expressed. We are working with stakeholders under the independent reviews, as well. That is important for the efficacy of the delivery and roll-out of PIP. I will take the views and representations made by the Committee into consideration, and we will work with hon. Members, as well. I will be happy to discuss this matter further outside the Committee.
The hon. Gentleman touched on the issue of how frequently claimants who are terminally ill receive their DLA or PIP. Those claimants receive their benefit payment weekly in advance, as opposed to four weeks in arrears, the normal payment cycle for PIP. As I said, I am happy to discuss the matter further and take on board hon. Members’ considerations and representations. I therefore urge the hon. Gentleman to withdraw the new clause.
Neil Coyle
I thank the Minister for her response. It is good to know that there is a window of opportunity to explore this issue in a bit more detail. As I mentioned at the beginning of my remarks on the new clause, I hope that my hon. Friend the Member for Sheffield Central and the organisations in his constituency can be included in the discussions.
The fast-track system the Minister mentioned is there not out of the goodness of the Department’s heart; it reflects the fact that these people have only six months to live from diagnosis. Looking to have equivalent support for those on disability living allowance who are transitioning to the personal independence payment gives us a small window of opportunity to make sure that there is no time lapse and that people do not end up out of pocket purely because of a postcode lottery.
I welcome the Minister’s commitment and hope the discussions she mentioned are fruitful. If things are not as clear as we would like before Report, there will be the opportunity to discuss the provisions in the new clause at that stage.
To come back to the earlier point about taxpayers, there are many disabled people who use DLA and PIP to support themselves in work. In-work costs are higher for many disabled people—public transport costs, different work uniforms or whatever it might be. We should not lose sight of that. It would be useful if the Government could give a stronger indication that they would be willing to consider having higher payments, which the triple lock would achieve.
I beg to ask leave to withdraw the clause.
Clause, by leave, withdrawn.
The Chair
This is my last sitting of the Committee. I thank all members, including the Ministers and those sitting on the Opposition Front Bench. In particular, I thank both Clerks, who have been tireless in their work, and Hansard.
Ordered, That further consideration be now adjourned. —(Guy Opperman.)
Westminster Hall
(8 years, 6 months ago)
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Prisons: Planning and Policies
(8 years, 6 months ago)
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Robert Neill (Bromley and Chislehurst) (Con)
I beg to move,
That this House has considered the Ninth Report from the Justice Committee of Session 2014-15, on Prisons: planning and policies, HC 309, and the Government response, Cm 9129.
As always, it is a pleasure to serve under your chairmanship, Mr Walker. This debate is a voyage of discovery for many of us, because very few of us were members of the Select Committee at the time the report was drawn up—[Interruption]—apart from my hon. Friend the Member for Henley (John Howell), who will therefore carry the bulk of the burden on the report’s technical detail.
As well as welcoming you to the Chair, Mr Walker, this debate gives me the opportunity to pay tribute to my predecessor as Chairman of the Committee, Sir Alan Beith. He was not only a very distinguished Committee Chairman, but a good friend to many of us, and I want to put on record how grateful I am for the support and wise advice that he has given me since I took over the chairmanship. I am sure that that will be recognised across the House.
This will not be a long debate. The report itself is not long, but it is important because it touches on key issues relating to prison policy. Interestingly, that has become topical once more with the very welcome comments from the Lord Chancellor and Secretary of State for Justice. I am very grateful to see the Minister for prisons in his place today, and I thank him for the courtesy that he has already shown to our Committee in responding to a number of inquiries that we have made of him.
In essence, I want to concentrate on two issues that the report highlights: first, the size of the prison population, and secondly, the sort of regime and purposeful behaviour that we ought to see in our prisons. It is worth bearing in mind that against the background to this report, the most up-to-date figures, as of 2 October this year—after the report was published—show that the prison population is now 85,973. That is one of the highest rates of incarceration in western Europe, and we ought to pause to think about why that is the case. We know, too, that the National Offender Management Service is operating at about 98% of its usable operational capacity, so things are pretty tight in our prison regime. NOMS is—properly, I think—going through a period of substantial change, with significant modernisation work, and the Department will have to take its share of the necessary savings that we have to make as part of the deficit reduction strategy.
A number of members of the current Committee and I had the chance to visit Holloway prison recently, and I want to pay tribute to the governor and her staff there. Despite the pressures on them, they are clearly doing a great deal to modernise, improve and upgrade their work, and they are getting very good results indeed. There are some very dedicated people in our Prison Service, and it is worth putting that on record.
That need for change, which is recognised at Holloway and right across the prison estate, has two aspects: first, the new-for-old policy, and secondly, the benchmarking scheme. The new-for-old scheme seeks to replace old and inefficient prisons with newer and more efficient establishments. Holloway is a good example of that. I remember, many years ago, as a young barrister, having to go to see clients in the old Holloway prison, which was a pretty dreadful establishment. The work that has been done with the modern building has made things much better. I think the last prison I had to visit was Chelmsford, and we are still dealing there with old establishments and old buildings. We only have to look at Wandsworth, Wormwood Scrubs and Pentonville to see that the nature of the estate constrains our professionals’ ability to do rehabilitative work. I think that we all very much welcome the Lord Chancellor’s comments and his commitment to look at finding the means to replace old estates with something new and fit for purpose. The report flags up that very important aspect of the work.
The benchmarking was described by Phil Wheatley, who was the former director of NOMS, as, in effect, finding what
“the most efficient way of doing everything”
is and then making sure that everybody does it. That is why a series of benchmarks were established—those of us who have been involved in local government will be familiar with the concept and approach.
The Committee agreed with both those matters in principle but raised a number of substantive concerns: first, the rising level of overcrowding; secondly, the fall in prison performance and the extent to which understaffing may be an issue; and thirdly, prisoner and staff safety in prisons. A linkage between all those matters is clear from the report.
Overcrowding is important. It is not adequate simply to say, “Overcrowding is merely about people sharing a cell.” It goes beyond that, as the Lord Chancellor rightly recognised in his recent comments. The current chief inspector of prisons has said that two problems stem from overcrowding. The first is the whole question of physical conditions. Prison is punishment in itself—the deprivation of liberty—and we have a duty to make sure that those who are deprived of their liberty, as a legitimate punishment, none the less have decent conditions in which to live. I know that the Minister is very committed to that, but we need to make sure that that is actually delivered in practice.
The second point is the impact that overcrowding has on access to purposeful activity, and my 25 years or so in practice at the Bar made me very conscious of that. All too often, I saw clients of mine on a merry-go-round, almost. They would go into prison and experience a lack of any purposeful activity while they were there, a lack of rehabilitation, and a lack of follow-up, and lo and behold, they were putting me in fees again perhaps two or three years later. That should not be the case. Neither my hon. Friend the Member for Cheltenham (Alex Chalk) nor I, as lawyers, want to have repeat clients frankly. It is a failure of the system, but we see too much of that in the current circumstances. Overcrowding makes it harder to do the rehabilitative work that is so critical, as the Government recognise. Many prisons have to operate split regimes at the moment, where half the prisoners are locked up in the mornings while the other half engage in activity, then they swap. That constraint is needless and makes it harder to deliver what we want to do.
The figures on the current state of overcrowding have been rising steadily, as has always been conceded. There were some errors in the recording of that in 2013-14, but 24.1% overcrowding seems to be the accepted figure now for that year.
Alex Chalk (Cheltenham) (Con)
Is it not right to point out that certain exceptional areas of overcrowding can be concealed beneath that average figure? I think—I may be wrong—that, in particular, York and Swansea prisons have a dramatically higher level of overcrowding. To the greatest extent possible, we need to ensure that that is not concentrated too much in individual prisons.
Robert Neill
That is absolutely right. I remember going to Swansea some years ago, where there was overcrowding even then, and that continues to be the case. That variation is really not desirable. There is a raft of constraints, and that is why, again, the new-for-old policy is hugely important. HMP Thameside, for example, was almost specifically built with the intention that it should be crowded. It was almost designed on the basis of a lack of capacity—before this Government’s watch, I hasten to add. However, we do need to address some real issues in that regard.
The Government are right to say that there are constraints on reducing overcrowding, because this is a demand-driven activity. We rightly cannot seek to influence directly how the courts sentence individual offenders. There will come a time, inevitably, when it is necessary for judges to pass custodial sentences. I know, as does any practitioner, that they do not do that lightly but, at the end of the day, the Government have to provide the necessary capacity to deal with that sentencing regime. At the moment—the Minister may have more up-to-date figures than me—the National Audit Office puts the cost of eliminating overcrowding at about £900 million. I accept that it is not possible to afford that in the immediate term, but it is important to have a programme that, over time, through capital investment, will bring on the new estate that will make dealing with the issue much easier.
Overcrowding is going to be an issue, but we need to manage and deal with that. That is why the Committee was anxious to see more attention given to overcrowding than has perhaps been the case. I think that the current Secretary of State recognised that in several comments; he certainly did so in the evidence that he gave in the first session of the new Committee in this Parliament.
The recommendation was to develop a broad range of measures to reflect the realities of prison conditions. Frankly, the Government were not willing to take that recommendation on board. I hope that they will think about that. The measurement at the moment may not be realistic in terms of capturing the actuality on the ground. We need not be wedded to any particular formula. There is no magic about the way the measurement is done. It is a question of what the most efficient measure is. I hope simply that the Minister and his colleagues will reflect again on our recommendation, particularly in the light of the Government’s new commitment to rehabilitation. Perhaps that is something we can do, because it is important that we have a measure that is measurable. One piece of evidence that we were given in the previous Committee was that the current system of measurement makes it very hard to measure the improvements and the outputs and inputs.
The other matters on which we concentrated were benchmarking and staffing levels. The inspectorate of prisons uses a four-stage healthy prison test in relation to its benchmarking. The four key figures are safety, respect, purposeful activity and resettlement. I do not think that anyone would disagree with those. Sadly, there has been, according to the evidence that the Select Committee received, a fall in those standards in the past couple of years. Each year, the inspector of prisons makes their report and provides a percentage figure for the inspected adult prisons and young offenders institutes that have been rated as good or reasonably good. Regrettably, the percentage of prisons so rated has fallen on each of those criteria, particularly in the past year.
Our report, comparing the figures for 2013-14 with those for 2014-15, showed that there had been a number of falls, which it is worth putting on the record. In relation to prisons inspected, the safety rating had fallen from 69% to 42%. The respect rating had fallen from 67% to 58%. For purposeful activity, it had fallen from 61% to 42%, and for resettlement it had fallen from 75% to 53%. It is fair to say that there has been an updating in the latest annual report, which I think was not available to the Select Committee at the time. It now shows safety at 52%, respect at 64%, but very worryingly from my point of view, purposeful activity at 39% and then resettlement at 57%. The linkage between purposeful activity and resettlement is, many of us would suggest, very significant. Although there are improvements on some scores, there is clearly more work to do. The Minister may have to hand yet more up-to-date figures, which I am sure he will share with us.
There is some improvement, therefore, but it does leave, overall—on the information that we have—the proportion achieving good or reasonably good ratings at about 40%. That means that 60% of prisons are not getting into that proper category. That is obviously a matter of concern. I know that the Government share that concern; I am very conscious that the Government are not complacent about the issue, but it is important that we put it on the record and see what is proposed to deal with it to take it forward.
Let me deal in particular with rehabilitative outcomes. I referred to the visit to Holloway by the current Committee. A number of my hon. Friends were on that visit. We were particularly interested to see how the restrictions on release on temporary licence sometimes denied mothers the chance to engage with childcare on ROTL and opportunities to work in the community before release. That is not, I think, for want of will among the staff involved, but it seems that we are not yet there in getting that delivered on the ground. I would be interested to hear from the Minister what more can be done on that.
The previous Committee called witnesses to find out as best they could what might have caused the fall in standards. The suggestion was that there was an issue about the incentives and earned privileges scheme—that, of course, allows prisoners to access benefits in exchange for responsible behaviour—and about staffing levels. That was the view put by the witnesses. It has to be said in fairness that the Government took a converse view, saying that essentially this is a demand-led matter involving unexpected and more challenging prison population levels and a cultural increase in suicide rates, which I think is accepted and is a matter that we have to deal with. There is no simple, one-size-fits-all answer to all this, but it does warrant our continuing attention and concern.
James Morris (Halesowen and Rowley Regis) (Con)
The report alludes to some evidence of increased suicide rates in the prison population and other aspects in relation to mental health in prisons. Does my hon. Friend agree that one way of addressing demand and some of the issues that he has raised about rehabilitation is to look wholesale at how mental health is tackled in prisons? As he will know, there is a very high prevalence of mental health problems in the prison population.
Robert Neill
My hon. Friend’s intervention is very important. That issue concerned me when I was a practitioner. All too often I saw people with mental health issues, and frankly the estate and the arrangements were not geared up to deal with that adequately. On several occasions, one would find that the case had to be adjourned because the prison psychiatric service was not able to produce some of the necessary reports, never mind the ongoing care that was required. Often, particularly with short sentences, people are released, there are mental health issues, and there is not the follow-up. Everyone accepts that there is a need to do more about this. As I said, I am conscious that the will is not lacking; the issue is finding the best means of achieving our aim. I think that that is a most important point. Again, the age of the estate and the lack of activity contribute to the pressures on what are often quite fragile people. My experience always was that some people end up in prison because they are very bad people, but a lot of people end up in prison because they are vulnerable and fragile and their circumstances have worked out badly. They need some help to be rehabilitated. They are the people whom we can best rehabilitate, but often the facilities are not there to help them in the way that all of us would wish, so it is a very powerful point.
Understaffing of course contributes to those problems. We have seen that it affects the regime. The Government are of course doing their best in relation to restricted regimes and deploying staff on detached duty, but that is obviously not a long-term solution. We need to find a better way around the problem. It cannot be sensible in the long term that, for example, a laundry at Wormwood Scrubs, representing about £1.3 million of investment, was in effect inoperable for a period because there were not the staff there to deal with it. We have seen, for example, the inspection report on Her Majesty’s young offenders institution at Cookham Wood: 36% of boys are locked up during the core day. As the report by Lord Harris of Haringey legitimately and properly highlights, these are young and often vulnerable people. They have to be punished; they have to be detained. That is right to reflect what they have done, but it is very hard to do the rehabilitative work with lock-up for that amount of time. We ought to address that as a matter of urgency.
Detached duty of course involves a degree of movement of staff. That places pressures on the staff themselves. It is necessary sometimes—I do not think that anyone would have an issue with the principle of it—but it is not desirable in the long term, because of the element of disruption for the staff themselves, but also for the prisoners. It is very difficult to build up the relationships that one would wish if one is having to detach staff and send them away from their normal arrangements. Also, of course, other staff have to work harder to compensate. It is actually a rather costly way to deal with the issue in the long term.
We have, however, seen improvements in staff turnover. We were concerned about staff morale and turnover. It is a credit to NOMS that staff turnover appears to have decreased from 15% in 2014 to 8% in 2015—credit where it is due for the work that has been done on that. There is also a recruitment drive to remedy the shortfalls. I understand that the number of officer vacancies has fallen to about 3% below the benchmarking levels. Again, that is welcome, but it is important that we sustain it, and I am sure that the Minister will update us on the work that is being done in that area.
The Committee’s conclusion in its report was that the key explanation for many of the deteriorating performance levels was, in addition to the age of the estate, understaffing. That seems to be being taken on board, but I would like to know what is proposed to ensure that that is further borne down on and that we sustain the reduction in understaffing.
The Committee recommended that the Government should alter staffing benchmarks upwards to ensure that prisons returned to former levels of operational performance. The Government rejected that recommendation, and I would like to know more from the Minister about why they felt that it was not appropriate. I am sure we all agree that we ought to update and improve our statistics and benchmarking, and I would be interested to know the Government’s current view and their proposals for the future. Do they anticipate further upward calibrations in the staffing benchmark, and how do they propose to deal with the problem of restricted regimes?
I will leave my hon. Friends to deal with the question of self-harm. I am conscious that I have already taken 20 minutes to open the debate, and others wish to speak. I hope that the Minister will help us on current self-harm figures. According to the figures that we have at the moment, some 2% of prisoners are on the basic regime, 52% are on the standard regime and 45% are on the enhanced regime, which indicates levels of vulnerability that need to be addressed as a matter of some urgency.
Evidence from the Prison Reform Trust highlighted the risks surrounding the first period of custody. I would be interested to hear the Government’s response to that evidence and their view on how we should deal with it as well as with the number of prisoner-on-prisoner assaults, which remain a concern. Those have risen, as have the number of assaults on staff.
The previous Select Committee quite properly flagged up a number of issues in this report. There is a broader resources problem, in both capital and revenue terms, which needs to be addressed. The Committee concluded that we need to re-evaluate how we use custody, and alternatives to custody, in a cost-effective way that best promotes the safety of the public and reduces crime. That is entirely in line with what the Lord Chancellor said in his evidence to the Select Committee in this Session. I look forward to hearing from the Government precisely how we should take that entirely legitimate and deserving objective forward.
John Howell (Henley) (Con)
It is, as always, a great pleasure to serve under your chairmanship, Mr Walker, and to follow my hon. Friend the Member for Bromley and Chislehurst (Robert Neill). I was going to say that I am the last surviving member of the previous Justice Committee, but that would appear to suggest that all the others were dead. Given that the hon. Member for Islington North (Jeremy Corbyn) and the hon. Member for Hayes and Harlington (John McDonnell) were two prominent members of that Committee, that is probably not the case. It was interesting to serve with them.
I am one of the few Members left on the Justice Committee, if not the only one, who had a role in preparing the report that we are debating. It was the Committee’s first major report on prison policy. There were good reasons for undertaking it at the time, because prison policy was the subject of much reform. We wanted to look particularly at benchmarking and the new-for-old programme, which my hon. Friend the Member for Bromley and Chislehurst has referred to. I want to comment on a couple of the points that he raised about resettlement and rehabilitation, and the engagement of prisoners in purposeful activity. Those are crucial, and they are very much interlinked in the whole programme.
As part of the preparation of the report, the Committee had a trip to Denmark and to Germany. Members might imagine, from anecdotal evidence, that the two places were very similar; in fact, we found them to be radically different. That was particularly true of Denmark. Although the feeling on the street may be that its regime is easy for prisoners, we found it to be quite stiff, and some good lessons arose from the experience. For example, we visited an open prison in Denmark that was surrounded by an enormous steel fence. That came as a bit of a shock to us, because one does not expect to see such a thing around an open prison, especially in Denmark. We asked why it was there, and the answer that we were given was that it was not so much to keep prisoners in as to keep the drug pushers out. That brought home to us the first point of similarity between the Danish system and our own: the acknowledgement that the use of drugs in prison is a major problem that has to be overcome. When we went to Germany, we found that there was the same level of drug use but, interestingly, it was not recognised to be a problem.
On our visit to Denmark we gained a particularly interesting insight into rehabilitation, which we bring out in a recommendation in the report, when we went to see how the prisoners cooked their food. I suppose that phrase gives the game away—the prisoners did not eat at enormous benches where food was slopped out to them in the style of the television series “Porridge”; the system allowed them to earn money in the prison and go to buy food, which they could cook communally for themselves and other prisoners. It is true that the knives used in the process were chained to the wall, but such a precaution is only to be expected in a prison.
That single activity was very important, because it created a sense of prisoner responsibility, which was absolutely conducive to the idea of rehabilitation. We pointed out that the Government should consider that for prisons in the UK, and I was pleased to see in their response that they would look to increase the opportunities for self-catering where appropriate. Perhaps I can push the Minister to confirm that that is happening—particularly in new-build prisons, where I think it is perfectly feasible and appropriate to work in such an arrangement.
Something else that we noted on our trip—this was most obviously the case in Germany—was the amount of industrial or commercial activity that the prisoners undertook. We visited a furniture operation in part of the prison, which involved prisoners in a tremendous amount of work producing excellent furniture for sale at a later stage. Such work is absolutely crucial: not only does it give prisoners dignity in work, which we have claimed to be important throughout the process, but it helps with their rehabilitation by giving them the ability to manage their own time and responsibilities. I am conscious that the ability to provide such a facility in prisons in this country is lacking. I ask the Minister what has been done, and what continues to be done, to take that forward.
Our impression from both trips was positive about prisoner rehabilitation. When I looked again at the situation in the UK, I saw that, as we demonstrate in the report, a lot of emphasis is placed on health and safety, on the safety of prisoners in prisons and on the sorts of figures that my hon. Friend the Member for Bromley and Chislehurst mentioned concerning the performance of the prison estate. I cannot help but feel that those things are linked—that the decrease in safety and the increase of attacks in prisons are due to the difficulty of trying to make purposeful work happen.
Another issue that we point out in the report is the role of prison governors, who are seen by the general public as being almost like latter-day Roman governors in their own prison. In fact, they are not. We visited one prison governor who had virtually no control over the educational activities taking place in his prison. There needs to be some move back to giving prison governors control of the places they run and what they do in them, which will improve the workings of the prisons and the outcomes for prisoners. Implementing the key recommendations of the report will help.
Jenny Chapman (Darlington) (Lab)
It is an immense pleasure, Mr Walker, to serve under your chairmanship once again this week, as I do every Wednesday afternoon on the Select Committee on Procedure. I do not think that I have ever taken part in a debate that you have chaired in Westminster Hall.
It is a pleasure to respond to this report by the Select Committee on Justice. The previous speakers have been incredibly kind to the Government. When I read the report, I thought what uncomfortable reading it would be for Ministers and officials, as it does not pull its punches at all. The hon. Member for Bromley and Chislehurst (Robert Neill) has been incredibly generous in his presentation of the report; his manners are a credit to his parents. I do not think that I will be quite as polite. I am under no illusions about the nature and scale of the task faced by the Ministry of Justice in tackling the crisis that is beginning to take hold in prisons. It is a crisis, and I do not use that word lightly. I have avoided using it for my first four years in this role, but I am beginning to think that a crisis is exactly what we are seeing.
The report explains very well the overcrowding and violence, and that there is zero improvement in reoffending figures. [Interruption.] The Minister is asking his officials. They will find a not statistically significant reduction in reoffending figures—a wasted five years in the previous Parliament. Opportunities have been missed to improve outcomes. It seems that almost every opportunity has been taken to make matters much worse.
The most urgent issue that the report, quite rightly, addresses is that of violence in prisons. The Minister and I have had debates in here on that very issue. I know that he is acutely aware of the level of the problem and he knows of my long-standing concern, which dates back to early in the previous Parliament, when I met one of his predecessors, the hon. Member for Reigate (Crispin Blunt), along with prison officers from the north-east.
One of the officers, Craig Wylde, had been assaulted by an inmate with a history of violence who had barricaded himself into his cell at Frankland prison near Durham. The inmate attacked several officers with a broken bottle, causing life-changing injuries. As far as I am aware, they have not all been able to return to work. That case brought home to me that violence in prisons is not just a case of throwing punches or the inappropriate use of restraint techniques. It can be extremely serious.
For the first time that I can remember, this year we lost a serving custody officer while she was at work. That happened since the publication of the report; I am sure it would have been included. Although she was not in a prison at the time, the tragic event reveals something about the level of risk that prison staff take on a daily basis. At Prime Minister’s questions in the week following that dreadful murder, members of neither Front Bench—I do not reserve criticism just for those on the Government Front Bench—used the opportunity to pay tribute to Lorraine Barwell in the way that they, quite correctly, do when a member of the armed forces or a police officer is killed in the line of duty. It saddens me to acknowledge that this reveals something of a disparity of esteem in the eyes of the media and the public. That is not right and we must all work to put it right. Prison officers are brave public servants working to keep us safe. They deserve equal respect and acknowledgement for the job they do.
I have spoken for the Labour party on prisons since 2011. Throughout that time, the deterioration of standards in jails has been shocking, and they were not in a great state to begin with. I worked in prisons in the early ’90s; I know exactly the state that they were in then and I see the state that they are in now. I have seen nothing but decline. The situation is not, in any way, the responsibility of those working in our prisons. They are not to blame. Overcrowding, understaffing and a lack of political interest or leadership is responsible. The statistics are really quite grim. As the report states,
“since 2012 there has been a 38% rise in self-inflicted deaths, a 9% rise in self-harm, a 7% rise in assaults, and 100% rise in incidents of concerted indiscipline…There are fewer opportunities for rehabilitation, including diminished access to education,”—
we all remember the book ban—
“training, libraries, religious leaders, and offending behaviour courses.”
There have been 43 suicides and five homicides in prisons in the past six months. Serious assaults on staff are at an all-time high, with overcrowding, drugs and radicalisation getting worse or, as the chief inspector feels, becoming accepted as part of prison life. The most telling paragraph in the report is paragraph 17 on page 70. I want to read a few sentences from it. It is quite disturbing and I would like to hear the Minister’s response. It says:
“It is possible that the Ministry might be taking the matter of the sudden rise in self-inflicted deaths seriously internally, but downplaying publicly its significance, and the potential role that changes in prisons policy might be playing in it, is ill-advised as it could be construed as complacency and a lack of urgency.”
That is how it is construed. I do not suggest for a second that that is how the Minister intends it to be construed or that he personally feels that way about it, but that is the perception in jails. That is why he urgently needs to set his mind about the issue.
I have spoken in similar terms on so many occasions, as have organisations representing staff and others with an interest in prisons, but the Government continue to speak in the same terms. We hear about the rehabilitation revolution, working prisons, and through-the-gate support, but it is all starting to wear very thin. The Government’s disdain—shown through their inaction, if not their words—is unforgivable. As well as a new Justice Committee Chair and, mostly, a new Committee, we have a new Secretary of State. It is great to hear him. Some of the things that he is saying are very welcome but we have to see more than just words.
However, even in the grimmest of times—and I think these are the grimmest of times in prisons—there are always shining examples of success. We have all visited prisons and seen workshops preparing offenders for employment, amazing charities working to maintain vital family links, prison officers helping inmates to read and businesses, such as Timpson, going to great lengths to provide jobs on release. I admire those working in our prisons to contribute to the gargantuan task of reducing reoffending.
The Government have made a start, and I want to encourage more of the same, but we must assess the effectiveness of such interventions and focus funding on those proven to be most effective. It is incredibly frustrating to find that the work that does happen is so patchy and is not enough to have a significant impact on reoffending figures, which is probably because the methods are very inconsistent and delivery sometimes lacks quality. Access to courses, as we know, is extremely limited, and understaffing leads to offenders spending time idle and to missed opportunities to put right bad attitudes.
I welcome the new Secretary of State’s declarations. I completely support him when he says that he wants better education in our prisons, and more of it. I support him when he says that he wants to work to create a system in which every offender gets a chance to change—absolutely. But, so far, his words are lacking in substance, and he has not yet come up with a single policy that tells us how he will achieve his aims. We look forward to hearing about those policies, but so far we have not.
The Secretary of State does not need me or anyone else to worry about him all that much, but in his rush to reform our penal system he must not forget the needs of victims or neglect the vital task of maintaining public confidence in criminal justice. I share many of the concerns that he expresses, but he must remember that, if public confidence is lost, his opportunity to reform will vanish, too. The Minister will probably ask, “What would you do?” That is a fair question. We would fundamentally change how prisons are managed. It is pleasing to hear the Secretary of State utter similar words.
The report also observes that prison governors are “effectively becoming contract managers”, which the hon. Member for Bromley and Chislehurst articulated well. Prison governors are constrained in their operational decisions, and the Committee rightly concludes that
“relegating governors to an oversight and partnership management role with much reduced discretion undermines their control over the performance and safety of the establishment and their ability to govern their prisons using their professional judgment, as they are trained at public expense to do.”
I would like to see the creation of prisons that are not centrally run from Whitehall. Instead, we should have locally run establishments. If hospitals, colleges and fire services are best run by local stakeholders, why not our prisons? It has never made sense to me that, at a strategic level, prisons should be entirely detached from the services needed to house, heal, educate and employ their inmates on release. It is no wonder that prisons do not succeed more often and that homelessness, unemployment, mental illness and drug and alcohol abuse are all commonplace among those recently released from prison. We know that those factors all contribute to reoffending and that roughly half those released from custody reoffend within a year.
I am glad that the Secretary of State seems to be coming round to that point of view. When we hear his concrete proposals, I have no doubt that we will do our best to support him, but it is widely accepted that work to prevent prisoners from returning to crime has to begin before release. That is better achieved if agencies with expertise in preventing homelessness or combating drug addiction have a stake in devising and delivering prison regimes, not just in providing programmes within a prison or providing support after release. That would be a major reform, and it would need to be piloted. Some service providers need to confront the consequences of getting things wrong the first time by taking a lead in putting things right. High reoffending rates are not the responsibility of the Ministry of Justice alone.
Conservative estimates say that about 23% of the prison population have been through the looked-after system. If that group were better provided for and prevented from committing crimes, we would save the Treasury an absolute fortune. Even if only half that group were kept away from crime, we would prevent some 10,000 people from becoming victims, saving about £270 million each year in incarceration costs.
Alongside a change in management, we need a change in inspections. Her Majesty’s inspectorate of prisons produces excellent, insightful reports that act as catalysts for change in the institutions concerned, and more widely—ending the handcuffing of women in labour is a good example. If, as the report suggests, Parliament is to be asked to devolve many of the decisions on running prisons to establishment level, we must have confidence that high standards of security and safety will never be compromised. I suggest that we need a new kind of inspectorate with more frequent unannounced inspections that produces reports with real clout. Too often, we see the response to a poor inspection report centre on the appointment of a new governor. I have read so many times that things have improved dramatically since an inspection took place, but inspectors need the ability to insist on meaningful and immediate change.
I encourage the Government to put more effort into preventing people from getting involved in crime in the first place. As the Committee rightly observes, prisons have no control over which, or how many, inmates they hold. As has been observed, effective policing, work with troubled families, Sure Start and good mental health services for young people are all ways in which the Government can improve outcomes in prisons. The Minister should share the love for prisons by trying to get some of his colleagues in other Departments as interested and as keen to improve things as I know he is.
The Committee rightly observes that, with the need to make financial savings in the medium term, there is no scope to spend more on prisons. I therefore encourage Ministers to look closely at the Youth Justice Board. We have committed to extending the YJB’s responsibilities to include 21-year-olds and to developing a women’s justice board because we want to reduce demand on prison places by intervening early to divert those at risk of committing crime away from harming themselves and others. We need to see the proper use of restorative techniques and beefed-up community orders, but never at the expense of public confidence. We must always be mindful of the needs of victims.
I never felt unsafe when I worked in prisons. I benefited from quality supervision and good support from all grades of staff. Uniformed officers took leading roles in preventing bullying. They demonstrated daily how to keep calm in tricky situations and how to de-escalate violent disagreements without anyone getting hurt; they knew how to listen. They were trained to support rehabilitation day in, day out without any fuss or particular expense. The report captures that very well, as did the Committee’s earlier report “Role of the Prison Officer”, which I commend to the Minister.
Twenty years on, prison officers are undervalued and underused. We need to support them so that they are not, and never will be, just turnkeys. As the Committee put it in 2009—it is just as true now as it was then—prison officers’ sense of vocation
“needs to be encouraged, nurtured and developed as far as possible rather than, at best, being taken for granted and, at worst, ignored.”
I am grateful for this debate. It is not often that we get the opportunity in this place to have a good romp around the issue of prisons, but this debate has afforded that, and I look forward to the Minister’s response. There is one more thing that I committed to ask the Minister. I now have a regular slot on BBC Radio Berkshire to talk about Reading jail. The Chairman of the Committee and the report discussed the new-for- old programme. It is a sound strategy in principle, but in some places such as Reading, there are empty, mothballed prisons at strategic sites in towns with potential global heritage value. Local people in Reading are getting frustrated at the Ministry of Justice’s lack of ability to decide what to do with the site. If the Minister or his officials can put the minds of the people of Reading at rest about the future of that site, that would be welcome, and would save me my early morning slot on Radio Berkshire.
Mr Charles Walker (in the Chair)
Before I call the Minister, I remind Members that we will hear from the Chair of the Committee for a few minutes after the Minister has finished his speech.
The Parliamentary Under-Secretary of State for Justice (Andrew Selous)
It is a pleasure, as always, to serve under your chairmanship, Mr Walker. I thank the colleagues who have spoken so knowledgeably in this debate; I know that they all care deeply about the issues, and I am grateful for their remarks and the expertise that they bring to our proceedings.
Let me start with the issue of prison reform, about which much has been spoken. It is true that our thinking on the issue is emerging and developing; I am grateful to the hon. Member for Darlington (Jenny Chapman) for her support for what she has heard so far. As she and others have said, it is clear that our current system fails to rehabilitate offenders and ensure that criminals are prevented from reoffending. Our prisons must offer offenders the opportunity to get the skills and qualifications that they need to turn their lives around, particularly qualifications that have value in the labour market and are respected by employers.
Key to the reforms that we are putting in place is the role that prison governors play in helping drive through change. We have many dedicated and hard-working governors—I had the pleasure of going to a Prison Governors Association meeting on Tuesday—and the Justice Secretary and I want to ensure that those who run establishments are more autonomous and accountable but also demand more of our prisons and of offenders. Currently, governors do not have control over what happens in their prisons. We want to give governors that control, and we want to incentivise and reward them for delivering the right outcomes.
The Secretary of State has also acknowledged that working conditions in much of the current prison estate—particularly older Victorian prisons, which have high levels of crowding, as the Chair of the Committee and others have mentioned—are not conducive to developing a positive rehabilitative environment. He has made clear his ambition to replace ageing and ineffective Victorian prisons with new prisons that embody higher standards in every way they operate. On the final comments made by the hon. Member for Darlington, we are actively considering all those issues and have set out the direction of travel. Over the past five years, we have sold 16 prisons, considerably more than in the previous 20 years or so. Our record has been one of taking action where we need to, and we are actively considering all those issues.
The money we make from selling off old prisons should be reinvested in commissioning a modern, well-designed prison estate that designs out the faults in existing structures that make violent behaviour and drug taking harder to detect. The Government recognise fully that the private sector has innovated well, particularly in its use of technology in prisons, and that there are opportunities to innovate further across public sector prisons.
We must also tackle overcrowding, which the Chair of the Committee also quite properly mentioned, with sufficient places to meet demand that all provide a safe and decent living environment. We have recently delivered 1,250 new places in the four new house blocks at Peterborough, Parc at Bridgend in south Wales, Thameside and the Mount outside Hemel Hempstead, and we are currently building a 2,106-person modern fit-for-purpose prison in north Wales. We recognise the Committee’s concern about the impacts of a rise in the prison population. The need to be prepared for unexpected rises in demand will always be necessary. As the Committee recognised, we keep the capacity for each population cohort under review and rebalance the estate as required.
I move now to the issue of education and employment, which has quite properly featured highly in this debate. Prison should offer offenders the chance to get the skills and qualifications that they need to make a success of life on the outside—a second chance to make the best of the education that, in many cases, they did not get when they were younger. That is a crucial area of our reform agenda, and the Secretary of State and I are putting in place steps to help make prisons places of purpose by increasing education and employment opportunities for offenders. That includes working with other Departments, such as the Ministry of Defence, to expand work opportunities.
I also pay tribute to companies such as Halfords. I have mentioned the academy that Halfords runs in Onley prison, where instructors and prisoners work together in a well-equipped workshop. They all wear Halfords sweatshirts, and prisoners go out on day release to work in Halfords stores. After they complete the course, on release, there are jobs available for them as bicycle mechanics in Halfords stores. That is an excellent model providing employment on release, and it is exactly what I want to see a great deal more of.
Jenny Chapman
The examples that the Minister cites are entirely appropriate and excellent, but they are just examples. The situation is patchy. What plans does he have to make that kind of experience the norm? My observation is that it is incredibly difficult to create such models of good practice throughout the country. It is something that Ministers have struggled with ever since I can remember.
Andrew Selous
The hon. Lady is absolutely right. We need to do better, and I am extremely ambitious and impatient to do more. I assure her that I regularly raise the issue with my officials, and I will continue to do so, because I share her impatience at the scale of the challenge. We need to act at pace to do something about the issue.
That said, work in prisons continues to grow steadily, with 14.9 million hours worked across the estate in 2014-15. However, as I said, I am determined to do much more. Increasing numbers of prisoners are also engaged in learning, but Ofsted inspections confirm that one in five prisons has an inadequate standard of education provision and another two fifths require improvement. That is why the Secretary of State has asked Dame Sally Coates, a distinguished former headteacher, to chair a review of the quality of education in prisons, which will report in March 2016.
The review will examine the scope and quality of current provision in adult prisons and young offender institutions for 18 to 20-year-olds. It will consider domestic and international evidence of what works well in prison education and identify options for future models of education services in prisons. In the meantime, work is already in progress to improve the quality of learning and skills in prisons, including: finding ways to improve class attendance and punctuality; collecting better management information, which is key; improving support for those with learning difficulties and disabilities, including mental health issues, which my hon. Friend the Member for Bromley and Chislehurst (Robert Neill) raises rightly and regularly; and developing more creative and innovative teaching.
On that point—I have mentioned it before—Swaleside has a good maths and English programme in the physical education department, of all places, that has been particularly successful at helping harder-to-engage prisoners improve their English and maths skills. That is exactly the sort of thing that I am talking about, and we need more of it.
In August last year, we introduced mandatory assessment of maths and English for all newly received prisoners, so we now have a proper baseline measure of prisons’ standards of literacy and numeracy. We have also invested in a virtual campus, a secure web-based learning and job search tool, currently available in 105 prisons to support prisoners’ education.
In addition to education inside prison, the Government also fully support prisoners using temporary release to take up work, training and educational opportunities in the community as well as to maintain ties with families. Although that should never come at the expense of public protection, it is a powerful tool for reintegrating offenders back into the community and preparing them for release. All the measures taken since the ROTL review in 2013 focus on minimising the risks taken in allowing temporary release and ensuring that releases are purposeful. The latest data show a 39% reduction in recorded instances of ROTL failure. We agree that ROTL can be a useful resettlement tool; it is important not to let abuse by a small number of people undermine it. We will review the impact of the new measures in 2016, so we can be sure that the public is protected while avoiding unnecessary restrictions on purposeful rehabilitative ROTL.
I turn to young people and young adults in custody. Although fewer young people are committing crimes for the first time, those who enter the youth justice system are some of the most troubled in our society, and too many go on to commit further offences. The significant reductions in volumes mean that the youth justice system now faces very different challenges. We need to consider whether the structures and delivery models created in 2000 are appropriate to meet the challenges of 2015 and the changes to the public service landscape. We also need to ensure that the youth justice system provides maximum value for the taxpayer. In recognition of the continued significant reductions in the number of young people in custody, as well as the scale of the financial challenge, we will not pursue plans to build a secure college, although we remain committed to improving education for all young offenders.
Robert Neill
May I raise one point on young offenders in particular? The Minister is right to highlight the changes that have been made and the reduction. The report from Lord Harris of Haringey highlighted the particular need for work to be done with those vulnerable people at risk of harm in custody. When will the Government make their response to the report?
Andrew Selous
We have promised a response in the autumn. We are actively considering that extremely important report, about which I will say a little in a moment if my hon. Friend, the Chair of the Justice Committee, will allow me.
In September, we announced a departmental review of the youth justice system, led by Charlie Taylor, the former chief executive of the National College of Teaching and Leadership. I recognise the importance of clear responsibility for the young adult offender group. We have therefore appointed a deputy director of custody for young people, within NOMS, as senior lead on operational policy on young adults. We are also working to improve the evidence base around what works best with young adult offenders. That includes developing and testing a tool to screen for emotional and social maturity, which should help us to understand need better and better tailor services and interventions for young adult offenders in prison or in the community.
The shadow Minister quite properly raised prison safety. The safety of our staff as they deliver a secure prison regime is an absolute priority. We are tackling dangerous new psychoactive substances, to help drive down the number of assaults and violent incidents. Measures have been taken to help deter prisoners from violence. For example, we brought in, for the first time ever, a joint national protocol between NOMS, the Crown Prosecution Service and the police, to ensure that there is a nationally consistent approach to referral and prosecution of crimes in prison. That is a really important mechanism. It is a significant change and will play its part in reducing violence in prisons.
The Serious Crime Act 2015 has brought in two new offences. Unbelievably, it was not an offence to possess a knife in a prison—if you can believe that—without authorisation. That has now changed. We are bringing in a new offence of throwing or projecting any item over a prison wall. The link to violence is very clear; it is mainly drugs that are thrown over the walls, and we know that new psychoactive substances are involved in provoking many violent incidents. That is why such measures are important.
We are bringing in other measures to record and understand the incidents of violence in prisons and the response to those incidents. We are developing a violence diagnostic tool, to enable better analysis at national, regional and local levels, and operational guidance for governors, to advise staff in prison on how they might better manage both potential and actual violent incidents. We are also piloting body-worn cameras in 22 public sector and two private sector prisons. I visited Glen Parva recently and was impressed by what I saw. The staff told me that they felt a lot safer; the prisoners also told me that they felt a lot safer, which is important. We will evaluate that early next year. We do not underestimate the hard work and challenges faced by our prison staff in dealing with serious violent incidents. We will continue to support our staff and help them to maintain safe and secure prisons.
The issue of self-inflicted deaths was rightly raised earlier. Whenever a prisoner takes their own life, it is a shocking and tragic event that is felt round the whole prison. We take our duty to keep prisoners safe extremely seriously. On any given day, prison staff provide crucial care to more than 2,000 prisoners at risk of self-harming. At times, that means someone literally sitting 24/7 outside a cell door, if necessary. We continue to make every effort to improve the care that we provide to vulnerable prisoners and learn from every individual incident.
It is too simplistic to attribute self-inflicted death or self-harm to staffing reductions or benchmarking. Deaths have occurred in contractor prisons, which have not been subject to reductions, as well as public sector prisons. All prisons are required to have procedures in place to identify, manage and support people who are at risk of harm to themselves. NOMS has put in place additional resources to undertake this safer custody work. NOMS is also reviewing the operation of the case management process for prisoners assessed as being at risk—procedures for assessment, care in custody and teamwork, known as ACCT. It is considering the recommendations of the Harris review into deaths of young adults in custody, about which the Chair of the Justice Committee rightly asked.
The Committee expressed concerns about staffing. The prison system has been under some pressure as a result of a rise in the prison population, combined with staffing shortages. That is most notable in London and the south-east, where the economic recovery may have contributed to a higher than anticipated staff turnover. Immediate action was taken early in 2014 to manage those recruitment shortages, including an accelerated recruitment campaign, the introduction of the Her Majesty’s Prison Service reserves, and staff sent on detached duty to the prisons with the greatest shortages. In the 12 months to June 2015, 2,230 new prison officers began training. Of those, 1,820 were new recruits and 410 were existing NOMS staff who have regraded to become prison officers. In the past 12 months to June 2015, there has been a net increase of 420 prison officers. Those officers will go at least some of the way to dealing with the issues of violence and safety that have been raised throughout the debate. We are also looking to recruit a similar number this year with our ongoing recruitment campaign.
There are, however, establishments where it remains hard to recruit. To address that issue, NOMS has looked at a number of options based on evidence, such as turnover, volume of vacancies and reward in other industries. A decision has been made against organisational objectives, Government policy on public sector pay and financial affordability, to improve our reward offer for prison officers at those sites. NOMS has worked, and will continue to work, to support its staff and provide them with the skills and development opportunities that they need to perform their duties with confidence and the necessary skills.
I shall quickly touch on the role of the external monitoring bodies. I wrote to the Chair of the Justice Committee in July, clarifying that the reference in the NOMS original response to the Justice Committee to a review of the independence of all criminal justice inspectorates was made in error, for which I apologise. A corrected version of the NOMS response has now been relayed in Parliament. I assure the House that in the absence of such a review, both the Secretary of State and I remain absolutely committed to safeguarding the imperative of an inspectorate that operates, and is perceived to operate, fully independently of both the sponsoring Department and the organisations in its remit.
The last major point I want to cover concerns our transforming rehabilitation reforms. As the Committee will know, reoffending has been too high for too long, which is why we have reformed the way that offenders are managed in the community. The transforming rehabilitation reforms seek to get the best out of the voluntary, public and private sectors to help offenders turn away from crime. These reforms mean that for the first time in recent history, virtually every offender released from custody will receive statutory supervision and rehabilitation in the community, including those offenders sentenced to less than 12 months in custody. We expect the new providers to make real contributions towards reducing reoffending, and we are closely monitoring their progress. The reforms have made substantial changes to how we manage offenders in England and Wales, and I am proud to be part of the team that has made those changes happen.
Of course, there remains much work to be done as we embed these reforms, and I take this opportunity to thank probation and prison staff for their continued hard work. They are doing a magnificent job, and they deserve our congratulation and recognition.
Regarding work, I agree with the comments of my hon. Friend the Member for Henley (John Howell). I was interested to hear about the experience in German prisons; the Singaporean prison system also places a very high emphasis on both getting prisoners into work in prison and getting them into employment afterwards. I am grateful to him for making that point.
The hon. Member for Darlington was absolutely right to refer to the tragic death of Lorraine Barwell. It was an horrendous incident and I can assure the hon. Lady that it was taken extremely seriously within the Ministry of Justice; reviews are ongoing and a charge of murder has been brought. The flag on the Ministry of Justice flew at half-mast on the day of the funeral. The hon. Lady’s comments were absolutely right. I myself have said it many times before and I say it again now: prison officers are on the front line, keeping us all safe. We owe every one of them a debt of duty. They may not be in the public eye in the way other front-line professionals are, but what they do is every bit as important. We need to recognise that on every occasion.
Thank you very much, Mr Walker; I am very grateful for having had the chance to respond to the debate. I hope that I have managed to respond to all the points raised this afternoon. If I have not done so, I will gladly write to hon. Members.
Mr Charles Walker (in the Chair)
Mr Neill, perhaps we can hear from you for a few minutes in summary.
Robert Neill
Thank you very much, Mr Walker.
I am very grateful to all the hon. Members who have participated in this debate, and I particularly thank my hon. Friend the Member for Henley (John Howell), who is also our Committee’s rapporteur on European issues. He is sort of a de facto vice chairman of our Committee, and I am particularly grateful for the long and continuing interest that he takes in these matters. I have found his expertise immensely helpful.
I am grateful to both the shadow Minister, the hon. Member for Darlington (Jenny Chapman), and the Minister for their comments. All I gently say to the shadow Minister is that my old pupil master always said that the most effective form of cross-examination was the politest and sometimes that is not a bad policy to adhere to, either as a politician or an advocate. That does not mean that the cross-examination is not pressed home, when necessary. The hon. Lady raised important issues, but I start from the premise that I am a fan of the Minister, and of the Lord Chancellor and new Secretary of State for Justice. I believe that they both want to do the right thing, and I know that the Minister’s personal commitment to prison reform and rehabilitation is very strong indeed.
I am also conscious that when the Government came into office they had to deal with some very significant financial challenges, which any of us who held office at that time had to confront. So I accept that there were pressures, and I also accept the point that we are dealing with very complex issues; very few people indeed end up in prison because of a simple set of motives or factors. Generally, a raft of issues come together and we need to recognise that.
I welcome the reforms that the Lord Chancellor and Secretary of State for Justice is proposing. That is why I, and I think all of the Committee, want to give them a fair wind. Reducing capacity is important, and I think we will press the Government over the coming year or so for more detail on precisely what the plans are to reduce capacity. Will there be an increase both in the build and in finding genuine, constructive and publicly credible alternatives to custody, wherever possible?
Also, I welcome the Minister’s commitment to doing more work on the follow-up of offenders once they are released. There is an awful lot of professional opinion now that questions the value of short sentences in particular, where very often there is no chance to do any real rehabilitative work. In the past, we have seen people released with virtually no supervision at all. Increased follow-up of offenders is certainly a move in the right direction, but the Select Committee will want to keep a very careful eye on this issue. In that context, as I have already done on the Floor of the House, I welcome the appointment of Dame Sally Coates, whose reputation in relation to this matter is a very high one.
This issue is about making things purposeful and the Minister is right to observe that the best rehabilitation of all is work and a sense of self-worth, and if we can try to promote those things in our prison regime that will be hugely effective.
I, too, pay tribute to the work of prison officers, and to Lorraine Barwell and others. Those of us who have practised in the criminal courts know the pressures on custody officers and prison officers, right the way through the system; it is not only in the prison environment that there are pressures but in the court environment and the transfer environment. Those officers all deserve our full support in relation to those matters.
I hope that this has been a useful report and a useful debate, and we look forward to continuing discussion of this matter. As the Minister will know, there will be a further significant inquiry by the Select Committee, on the basis of Lord Harris’s report and related matters. I look forward to the Minister and others doubtless giving evidence to us then.
Question put and agreed to.
Resolved,
That this House has considered the Ninth Report from the Justice Committee of Session 2014-15, on Prisons: planning and policies, HC 309, and the Government response, Cm 9129.
Civil Legal Aid
(8 years, 6 months ago)
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Robert Neill (Bromley and Chislehurst) (Con)
I beg to move,
That this House has considered the Eighth Report from the Justice Committee, Session 2014-15, on impact of changes to civil legal aid under part 1 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012, HC 311, and the Government Response, Cm 9096.
I am delighted to have secured this debate on the operation of the Legal Aid, Sentencing and Punishment of Offenders Act 2012, or LASPO as it is often called. I welcome the Under-Secretary of State for Justice to his place. We now commence our discussion of the second of the Justice Committee’s important reports that we are considering today.
I was prepared to give these reforms of legal aid a fair wind when they were introduced, but I also have concerns about them, as I think the Committee does. I do not say that because the objective of saving money is not important and, indeed, a significant imperative. I sympathise with the predicament of the Minister and of his predecessors; having been a Minister in an unprotected Department myself, I am very conscious that the financial circumstances that the previous Government inherited were dire, and changes had to be made and economies found. I accept that entirely.
Nevertheless, I and the rest of the Committee are concerned that the reforms may have had some unintended consequences, which perhaps we can now sensibly revisit. I was not a member of the Committee at the time the report was produced, but reading through it, a number of the concerns expressed chimed with my own experience as a constituency MP and, for what it is worth, my experience at the Bar. Although I no longer practise at the Bar, I still keep in touch with those who do.
Perhaps we can deal with some of the main issues that were highlighted in the report, and I look forward to hearing my hon. Friend the Minister’s response. I say that because, once again, I detect in both his comments and those of the Secretary of State a willingness to be open-minded about revisiting situations where it can be shown that there are perhaps better, more nuanced and more effective ways of obtaining the objective that we all want to achieve—having a legal aid system that concentrates resource where it is needed and that helps those who are in genuine need, but that does not encourage unmeritorious litigation. I think that we all share that view.
The Committee raised several issues on which I am interested in hearing my hon. Friend the Minister’s comments. First, there was a concern that the reforms, in a sense, were undoubtedly financially driven. There is nothing wrong with that in itself; it was a necessity at the time. Both the then permanent secretary and my hon. Friend’s predecessor as Minister were frank and fair about that to the Committee; savings needed to be made, and made quickly. However, that meant that no research could be undertaken about the impact of the reforms. Now, we are about a year on and although, frankly, it is unusual to conduct a Select Committee inquiry on reforms after only about a year, we are now able to see some of the impacts and I hope that gives us a chance to revisit some of the issues.
The position, of course, is that the MOJ is unprotected. The Committee was concerned that, although it may not have been intended, in practice the reforms introduced in April 2013 may well have begun to impede access to justice. If that is the case, we need to be prepared to accept it, and we should revisit the issues.
There were four objectives that the Government perfectly reasonably set themselves: to discourage unnecessary and adversarial litigation at public expense; to target legal aid at those who need it most; to make significant savings in the cost of the scheme; and to deliver overall better value for money for the taxpayer. There is nothing wrong with any of those objectives, but the evidence that the Committee received suggested that at least three of them have not been successfully achieved. That is why we need to be prepared to look at them again.
Access to justice is fundamental to a system based on the rule of law, and it is therefore important that any changes we make to the ability of the citizen to access proper legal advice are based upon objective evidence. That is the first and primary concern.
In terms of a saving, the National Audit Office concluded that the Government had exceeded their savings target by £32 million, because they were not funding as many cases as was predicted. Many Members will have people come to their constituency surgeries with debt issues, and in debt cases the shortfall was in the region of 85%. That indicates to me that the projections were pretty much based on back-of-an-envelope calculations and may not have had a great deal of research behind them. I am happy to be corrected if that is not the case. Given the speed at which it was acknowledged that that was happening, I can understand why that might be the case, but perhaps that is all the more reason to look again at the matter, if that is what is happening.
I am happy to see an underspend when it is genuine, but if it is an underspend because people who ought to be entitled to legal advice and support are not getting it, that is a failure in the system, and we need to find out precisely why that is so. One of the Committee’s concerns was that there was a significant lack of public information on accessing legal aid, and I have found that in my surgeries. In a comparatively prosperous part of suburban London, I have a lot of constituents coming to me who are unaware of how best to access legal aid and what their rights are. I suspect that the situation may be very much worse in other, more socially challenged parts of the country. We urgently need to revisit that issue.
The suggestion that people are simply moving to pro bono is not good enough. The pro bono work done by members from both sides of the profession is very important, but at the end of the day that is not a substitute for proper advice. That needs to be addressed, and I look forward to hearing what the Minister says on that.
Secondly, we have the operation of the exceptional cases funding scheme, which is an important part of the legal aid system. It was specifically and properly designed to ensure that any changes did not put us in breach of our obligations under the European convention or the European Union, and that is right and proper. The then Lord Chancellor described the scheme as a “safety net” on Second Reading of the Legal Aid, Sentencing and Punishment of Offenders Bill. I have no problem with a safety net, but we need to see how effective its operation has been. The evidence to the Committee on that raised concerns for us.
I appreciate things may have moved on—I am sure the Minister can update us if they have—but at the time of the Committee’s report, 7.2% of applications for ECF were granted. When the usual risk assessments and impact assessments were carried out for the legislation, the estimate was for that figure to be between 53% and 74%. I know from when I was a Minister that impact assessments are sometimes not entirely borne out in practice, but we are talking about a massive difference. When the figure is about one tenth of the top end of the impact assessment estimate, that indicates to me that something is going seriously awry. Either the impact assessment was very badly off indeed or the operation of the scheme has borne down much more heavily on deserving cases than Ministers ever intended. Some 60% of the grants that were made were for family representation at inquests, and that is good. I had a meeting recently with Inquest, which is an important and valuable body that does hard work in that field. Representation in that area is critical, but what about the rest of the significant shortfall? We need to examine that a little more.
We found—this is worth reciting—some exceptional cases where applications under the ECF were refused. They are exceptional cases; that is the whole point. An illiterate woman with learning, hearing and speech difficulties was facing an application that would affect her contact with her children. That was not regarded as suitable for exceptional cases funding, and that is difficult for many of us to appreciate. The judge in one case told us of a woman with modest learning difficulties who was unable to deal with representations from the lawyer on the other side. She is now facing possibly not seeing her child again. That troubled me in particular, because that coincides with my conversations with district and circuit judges and practitioners who operate in this field.
Anyone who goes to their county court will be aware of such issues, which raise a fundamental equality of arms argument. The other side is very often the local authority, which is represented by solicitor or counsel. Against that is someone who may not be able on their own to deal adequately with the process. To say that that is not an exceptional circumstance would be an unfair consequence of the scheme, and that sort of thing should not happen again in future.
I will give one further example. A destitute blind man with profound learning difficulties lacked the litigation capacity, so the official solicitor made an application on his behalf. Initially, that was rejected, and it had to go to judicial review. We should not be having to do that. That is clearly where the operation of the system, rather than the intention of Ministers, was at fault, but it means that we need to bear down carefully on how these cases are processed in the first place. I do not want a legitimate objective of efficiency and saving to get a bad name because of how it is carried out in practice.
Against that background, the Committee concluded that the low number of grants and some of those details meant that the scheme was not acting as the robust safety net that was intended. The risk of miscarriage of justice is real in some of those cases, and we should not allow such things to happen as a consequence of the reforms. We are concerned that so far we have heard no evidence of the Ministry investigating the significant disparity between the predicted number of grants—the 53% to 74% estimate—and the actuality of less than 8%. Will the Minister say what steps have been taken to investigate that enormous disparity? What steps are being taken to ensure that the scheme operates in a more equitable and just fashion? That is hugely important for the scheme’s credibility.
There has, in fairness, been an improvement in recent months, and I am sure the Minister will update me further. The statistics for April to June 2015 show an increase, with grants made to just over one third of all applicants. That is partly because Ministers reviewed the guidelines, and that was right and proper, but it required a review and decision by the Court of Appeal to make that happen. Ministers acted promptly on the basis of that decision, and I give them credit for that, but one third is still way short of the bottom end of the benchmark of 50%. We need more detail on what is being done to ensure that the percentage becomes more realistically near the estimate.
The number of applications remains low, and I would like to know what more can be done on that. The Committee’s inquiry involved some 35 oral witnesses over a period of months and some 70 pieces of written evidence. It is a not insubstantial piece of work that was undertaken by my colleagues who were on the Committee at the time. One reason that the Committee found for the low number of applications was the length of time that it takes to complete the form. That is not insignificant. I can remember sitting in the cells as a practitioner, completing the legal aid form before we went up on the first remand hearing. The form has gone well beyond that now, and the truth is that lawyers cannot claim the time for completing the form.
[Mr Graham Brady in the Chair]
I welcome you to the Chair, Mr Brady, as always. I am not here to make the case on behalf of lawyers, but completing the form is generally beyond the capacity of many lay people, particularly those with any difficulties. They need help to do it and the solicitor will not be remunerated for doing it. Many do it out of their professional sense of duty and obligation, and they are right to do so, but the form is an impediment. In many areas of Government, we are successfully making forms simpler and putting things into plain English. If we are able to make forms simpler in a raft of areas, including planning applications, local government matters and court forms, we ought to be able to do it for the application forms for these matters. What are the Government going to do on that?
A separate issue that causes concern relates to legal aid in family law cases, particularly in what is sometimes termed the domestic violence gateway. Happily, I never practised in that field, but I know that it is one of the most stressful that a lawyer, judge or litigant can encounter. The intention was—I do not doubt its goodness—that legal aid would be available where a litigant can show evidence of abuse within the past two years, with an exception where there is clear evidence of a conviction arising from domestic violence. That is the easy bit. We were concerned by the evidence to our inquiry on the operation of that need, in the absence of a conviction, to show evidence of domestic abuse from within the past two years. We found that some 39% of women who contacted a domestic violence charity about abuse did not have one of the prescribed forms of evidence. That leads us to conclude that the prescribed forms of evidence are too rigid and that there ought to be greater nuance and discretion around that.
Also, as anyone who has dealt with such matters would know, many people struggle with the two-year time limit, because family law cases have often dragged on for years. Relationships that can be abusive, often with as much emotional and psychological pressure as physical pressure, are all part of a picture that builds up over time. In such a relationship, where there may be children and it is difficult for the person to walk away, the strict adherence to a two-year limit can be artificial, and perhaps the guidelines do not coincide with the reality of life as many of us know it from our surgeries, and certainly as many experienced practitioners know it. I hope we can look at that issue again.
The Committee recommended that the Legal Aid Agency be allowed discretion to grant funding where, although the facts might not immediately fit the criteria, the victim of abuse would be materially disadvantaged by having to face the alleged perpetrator of the violence in court. We would not allow that in criminal proceedings, and we should not get into such situations in family proceedings, either. I hope the Minister will give us more details on that. I doubt it would increase the spend. The numbers are not great, but the potential injustice is very great, so I hope we can revisit that issue.
I am sorry that the Government rejected our recommendation. I ask the Minister, on behalf of the Committee, to think again. It is not good enough to say it is a catch-all clause and will lead to large amounts of litigation. I am sure it is possible to draft a sensible form of discretion that is not a blank cheque, but goes further to reflect reality than the current arrangements. We are a year on now. On the basis of the open-minded approach that the Secretary of State and his team are taking, now is a good time to revisit it in the light of experience and perhaps seek evidence from the practitioners and judges who hear such cases as to what might sensibly be put into the form. I hope the Government will think again about that.
The third issue that we raised, which again coincides with my own experience independently of the report, is sometimes called “sustainability and advice deserts”. There are parts of this country where it is very difficult now to find a lawyer to take on a civil legal aid case. Again, if in comparatively prosperous Bromley it is hard to find a solicitor to take on legally aided family work, it is a lot worse in many other parts of the country, never mind in rural areas where the question of simple physical access to a suitable solicitor can be significant. This is classically the area where pieces of research were to be published in 2015, but we have not yet seen the fruits of that research. Perhaps the Minister can tell us when it will be made public, because I have no doubt that the Committee will wish to revisit some of the considerations in the light of that.
The fourth area of concern stems from the increase in litigants in person. The contention at the time—I was prepared to give it a fair wind—was that there would be behavioural change through the removal of legal aid so that fewer people would choose to go to court to resolve their problems. I am not sure the evidence bears that out. I do not want to be an amateur psychologist, but perhaps the motives that lead people to go to court are not of a purely transactional nature. Sometimes, particularly in the most difficult cases, there are pressures that go beyond the ordinary straightforward business decision that we might make as to whether we litigated over a contractual matter, for example. This is not that sort of case. Very often there are other deep pressures that play upon people, which we may not have taken fully on board.
Also, I do not think we have done enough to promote the alternative of mediation, which I shall come to in a moment. On re-reading, I felt there was a finger in the wind approach to the assessment about behavioural change. The wind does not seem to be demonstrating that that is happening in the way that we would wish. Certainly the anecdotal evidence that we heard from people before the Committee, and others, was that there had been a significant increase in litigants in person. There is not a systematic means of collating that information; perhaps there should be. Even in the family courts where some figures are available, the accuracy and their significance was debatable. If we are to have such policy change we ought to know, and it should not be too difficult to work out. If litigants in person and those who are represented are logged, it should not be too difficult to pull the figures together so that we know better where we stand.
The National Audit Office was concerned that the increase in litigants in person in the family courts had cost the family court system an additional £3.4 million. I was disturbed at our evidence hearing on Tuesday to hear a senior official of the Department suggesting that there was no impact. Anyone who talks to anyone who sits in the county courts would say otherwise. There is an impact. We all know that litigants in person often take longer to present their case, which consumes court time and also affects soliciting as the costs run up on the other side, so it is in nobody’s interest in the long term to save money under one head of the justice system, but increase it on the courts budget, which is itself hard-pressed, on the other. Perhaps we need more evidence and a willingness to revisit that, too.
Moreover, often the increase in litigants in person is of people with real difficulties in coping with the system. We have moved on from a situation where the litigant in person was a fairly articulate person who chose not to employ a solicitor or a barrister—not something I would ever encourage, of course—because that was a sensible decision and they were able to deal with a straightforward case on its own merits. We now often deal with people coming before the courts with significant educational and communication difficulties and dealing with complex cases.
Karl Turner (Kingston upon Hull East) (Lab)
I want to make a serious point about what the hon. Gentleman has just said. The advice to litigants who propose to represent themselves is based on the fact that it is difficult for them to be objective. They are not in a position to sit back and look at the entire thing, and that often causes great delays going down the wrong road.
Robert Neill
The hon. Gentleman is absolutely right. That coincides with my own experience. Early and prompt access to legal advice can give an overall saving in costs to the system as well as producing a better outcome in terms of justice. I could not agree with him more. It is potentially a false saving and we should be wary of going down that route. I hope that we can have an update on the Government’s research and findings.
It is perfectly fair to say that the Government relied on the additional grant to fund personal support units in the courts. That is useful, but patchy. In some of the county courts that I have visited, there was limited personal support available. I had an instance of someone who was simply trying to fill out the form being told that they could not be helped at the local county court, but had to go to the royal courts of justice. They went to the royal courts of justice and got an out-of-date form, so they had to make two trips. That is not achieving the objective that the Government want, so we need to have an update on how the work is coming on.
Some reliance was also placed on the use of McKenzie friends and the unbundling of legal services. Unbundling can have its role, but my limited experience as a civil practitioner caused me deep concern about the use of McKenzie friends. The lack of objectivity that the hon. Member for Kingston upon Hull East (Karl Turner) referred to applies to McKenzie friends, too. I can certainly think of one case that was needlessly dragged out and the client sent in an entirely wrong direction, ultimately to their own considerable cost, as a result of an unregulated and ill-informed McKenzie friend, so I do not think they are a proper substitute. Such cases ought to be the exception rather than the rule. It is unfortunate that the Government rejected without any explanation the Committee’s recommendation on consulting on regulating McKenzie friends, or at least reviewing the whole operation of that type of quasi-advocate.
One of my two final points link to the question of a lack of alternative. The Government rightly have a commitment to mediation. We have the mediation pledge that successive Governments have signed up to. Increasing the use of mediation was an objective of the Government’s reforms. The estimate was that the number of mediation assessments in family law alone would increase by 9,000, and that was budgeted for. That was all well and good, but the evidence that the Committee received showed that the number of mediations fell by 17,000, or about 56%—it more than halved. The National Audit Office concluded that the Ministry of Justice had a “limited understanding” of why people go to court. The assumption that people would take up mediation was not adequately evidenced. In somewhat the same way as with legal aid, there is a lack of understanding of what mediation is available, how it is best accessed and how it is resourced.
My hon. Friend the Member for Henley (John Howell), who was present for the earlier debate, is a member of the Justice Committee, and he has recently set up an all-party group on alternative dispute resolution. That is a worthy cause, and I hope that several hon. Members will take an interest in it, because there is a lot more we can do to resolve a raft of issues in a non-adversarial fashion. Not enough is being done on that, and the Government need to be much more proactive. I would be interested to know what they intend to do to work out why there was such a disparity between the assessments and the actual uptake. I would also be interested to know what work is being done as part of the initiative they rightly introduced with Sir David Norgrove’s work on the family mediation taskforce. The taskforce is a step in the right direction, and we welcome it, but there are other areas where much more work can be done to increase the take-up of mediation. Although there has been an improvement, take-up is still about half the 2012-13 figure, and it is important to have some explanation of that.
The Government’s fourth objective was value for money in the system. The difficulty is that we cannot really quantify that at the moment, because there is no evidence regarding knock-on costs elsewhere in the system. The Committee thought—again, this coincides with my experience—that early intervention is often a cost saver. One witness described it as a fence at the top of the cliff, rather than an ambulance at the bottom, and there is a lot of common sense in that. Sensible early intervention saves time, saves money and saves injustice being done to parties. I hope the Ministry will look again at that.
The Committee recommended establishing a review of the reforms’ knock-on costs, but the Ministry rejected that on the basis that the Act would be reviewed between three and five years after implementation and that there had been no complaints. That rather misses the point, because there is already evidence of knock-on costs and of the reforms not working as planned. If we want them to bite and to be genuinely sustainable, waiting three years is quite a long time. That is why the Committee revisited them after one year. I hope the Minister will be able to say that the Government will move more swiftly to review the knock-on costs.
The Committee raised a number of issues. I wish the reforms a fair wind. However, I, as a loyal supporter of the Government, have concerns, as does the Committee, on a cross-party basis. It is right to take those concerns on board, because we need to look at them seriously. Having dealt with some of the immediate economic pressures that existed previously, it may be possible for us to revisit this issue and to adopt a more nuanced approach to making savings. Indeed, we may recognise other areas in the legal aid and criminal justice system where savings can sensibly be made. However, the ability to access justice in a fair way is critical to the equality of arms and to the system’s integrity. None of us would want that to be undermined—I know the Minister would not—and that is why the Committee raised the issues it did in its report. I look forward to the Minister’s response.
Karl Turner (Kingston upon Hull East) (Lab)
It is a privilege to serve under your chairmanship, Mr Brady. The hon. Member for Bromley and Chislehurst (Robert Neill), the Chair of the Select Committee, remarked in the last debate that his pupil master advised him that the most effective form of cross-examination is polite cross-examination. Well, his examination of the report was polite and fair, but it was also honest—it was a proper critique of the issues the Committee covered. I am afraid, however, that I will be rather more impolite than the hon. Gentleman.
The report is a damning indictment of the Government’s haphazard, ham-fisted approach to reforming legal aid. The Committee has set out in clear terms what an unmitigated disaster the reform of civil legal aid has become under this Government. Their ill-advised attack on legal aid, in the guise of reform, has undermined a long tradition of access to justice. The legal system in England and Wales was once the envy of the world, but I hope hon. Members do not think I am being over-dramatic when I say that other countries are now starting to rather disregard it, and it is being quite heavily criticised. We should be proud of a history in which the poorest and most vulnerable have had access to the law.
The Government had four objectives in the Legal Aid, Sentencing and Punishment of Offenders Act. Those were to discourage unnecessary and adversarial litigation at public expense; to target legal aid at those who need it most; to make significant savings in the cost of the scheme; and to deliver better overall value for money for the taxpayer. Of those four objectives, they have achieved only one. Significant cuts have been made to the cost of the scheme, but at what cost to justice? Indeed, one wonders whether there is any saving in reality.
Criticism of LASPO is wide-ranging, coming from the Bar Council, the Legal Aid Practitioners Group, Citizens Advice and many others. The Law Society has argued that many people are being denied access to justice as a result of the huge changes to civil legal aid.
It is obvious from the report that the knock-on effects of such large cuts were not thought through. The driving force behind them was purely ideological. There was no evidence-based approach to legal aid—there was just a “slash now and see what happens next” approach. As a Back-Bench Member, I served on the Committee that considered the LASPO Bill. We heard evidence from various groups and speeches by Members from both sides of the House warning the Government of the risks. However, all of that was categorically ignored by a Government whose aim was to make the cuts and to ask questions later.
The report is clear that
“the urgency attached by the Government to the programme of savings militated against having a research-based and well-structured programme of change to the provision of civil legal aid.”
The evidence given by Dame Ursula Brennan gave the game away. Her concession that the primary motivation for the decisions was the size of the spend shows the intellectual deficit behind the changes. Access to justice should have been at the top of the Government’s list when it came to reforming legal aid, but, as we have seen in the last few years, it appears to have been an afterthought.
The Government claim to have targeted legal aid at those who need it the most, but I am afraid that is laughable. The Select Committee Chair gave anecdotal evidence from practitioners in the relevant area, and it is true that members of the Bar and solicitors who practise on a daily basis in civil legal aid areas encounter major difficulties as a result of the changes to the law. I could continue, but the critique by the hon. Member for Bromley and Chislehurst included all that I wanted to say. He was fair and is clearly objective about what he has read. I know that he was not involved in the work on the report, which was done by members of the Committee under its former Chairman in the previous Parliament.
Attacks on access to justice have led to massive shortfalls in advice. We should all be concerned about it. The impact of the cuts is devastating in both civil and, indeed, criminal legal aid. I do not want to digress too much, but today criminal solicitors throughout the land are being told whether they have managed to get a contract for criminal legal aid in duty cases. I very much fear that the Government are going to make the same mistakes that they made with criminal legal aid under LASPO. Will the Government make a commitment to bring forward their review, so that the changes to civil legal aid can be rigorously and thoroughly examined? The Labour party recently announced a full review of legal aid, to include criminal as well as civil legal aid, led by Lord Willy Bach. I wonder whether that may prompt the Government to bring forward their own review of the Act.
The Parliamentary Under-Secretary of State for Justice (Mr Dominic Raab)
It is a pleasure to serve under your chairmanship today, Mr Brady, for what I believe is the first time—certainly as a Minister. I am grateful for the opportunity to respond to the debate. I am sure many colleagues will have noticed that I am not the Minister responsible for legal aid, and I want to convey apologies on behalf of my hon. Friend the Under-Secretary, the Member for North West Cambridgeshire (Mr Vara), who is caught in the joys of the Committee on the Welfare Reform and Work Bill. I shall address issues of substance—technical and detailed as they are—and principle as best I can. If I cannot deal with them I shall follow them up; or I am sure my hon. Friend will be able to.
I welcome the report and scrutiny, and particularly the tenor of the approach to the issue taken by the Chairman of the Select Committee on Justice. He began by pointing out that all the reforms are happening in the context of trying to deal with the deficit, and noted that the Ministry of Justice is not a protected area. There are no easy choices in this area and I welcome his emphasis on that. At the same time, I think it is agreed across the House that legal aid is a vital element in any fair justice system and I am proud to say that our system remains very generous. Last year we spent £1.6 billion on legal aid. That is about a quarter of the Department’s expenditure. All sorts of issues arise in connection with methods and modalities of legal aid reform—I thought that the Select Committee Chairman handled this aspect of the matter well—but it is incumbent on those whose bottom-line position is that we need to spend more to explain responsibly where the money will come from. They should explain whether it would be from prisons, within the Ministry of Justice budget. We have just had a debate on prison reform and we all understand how difficult the pressures are there. If more spending on legal aid is not to come from the Ministry of Justice budget will it be from the schools or health budgets?
Karl Turner
The point, which the Committee made very well, is that there is not necessarily a real saving. There may be a top line saving. Legal aid spending may be reduced, but that is going down the road to another Department. Some other area has to pick up the bill in the end.
Mr Raab
That is not correct or accurate and I will address the point in detail shortly. The hon. Gentleman must face up to the fact that the shadow Justice Secretary in 2011, the right hon. Member for Tooting (Sadiq Khan), made it clear that the Labour party’s position then was that cuts would have to be made. I have heard little of substance from the hon. Gentleman other than that the Labour party, even under its current leader, is punting the whole issue into review. It sounds a little to me as if there is a lot of critique but not many positive ideas about what to do.
Alex Chalk (Cheltenham) (Con)
In the context of the need for cuts, should we not bear it in mind that one of the issues of concern to the Committee was the underspend on legal aid? There were concerns about lack of information about its continued availability. Is not it important to ensure that where there is legal aid those who may be entitled to it are notified of that, to ensure that they get access to justice?
Mr Raab
My hon. Friend is right and that is a more legitimate question to raise.
For all the bean-counting, and the importance of the deficit, the Government have a responsibility to ensure that those in the greatest hardship, at times of real need, are provided with the resources to secure access to justice. As well as being grateful to the Select Committee Chair, I am grateful to all hon. Members in this and the previous Parliament for their diligent and careful scrutiny of our legal aid reforms. Some fair points have been made in the reports, and by the Chairman today.
When the programme to reform legal aid commenced in 2010, the scale of the financial challenge faced by the Government was unprecedented, so we had to confront those difficult decisions. It was our clear intention to remove legal aid for some types of cases while protecting access to justice in key areas. That is why we have sought to make sure that legal aid remains available for critically important cases: where someone’s life or liberty is at stake; where they may, for example, lose their home; in cases of domestic violence; or where children may be taken into care. We were clear about wanting more cases to be diverted from court where suitable alternatives are available. Let us face it; the justice system is there not for lawyers but for society, citizens and victims. There is no doubt that in many cases the court should be the last, not the first, resort.
The changes we had to make to legal aid have been contentious. They were debated extensively, with amendments made throughout their passage, before they were approved by Parliament. Those changes need to be judged fairly, given the passage of time. Yes, the reforms in the Legal Aid, Sentencing and Punishment of Offenders Act 2012 have made a considerable contribution to my Department’s programme to reduce its spending, and we are on course to achieve our planned savings; but legal aid continues to remain available where it is most needed. For example, last year we began funding legal representation on more than 46,000 new proceedings under the Children Act 1989 and almost 14,000 proceedings related to domestic violence protective injunctions. Those are the kinds of cases where it is really important that there is still a safety net.
We have also made sure that funding will be provided, where it is needed, through the exceptional funding scheme. That scheme has been criticised and it remains the subject of continuing litigation. I am sure that hon. Members will appreciate that I cannot comment on that litigation. The exceptional funding scheme has never been intended to provide a general power to fund cases that fall outside the wider generic scope of legal aid. That is not its purpose. The scheme is expressly aimed at making sure legal aid is provided when it is required strictly under the European convention on human rights or otherwise under EU law. In the two years following the implementation of LASPO we have granted exceptional funding in almost 300 cases, and the number of grants is rising with each quarter. In the most recent quarter, April to June 2015—I think that the same figures were cited by the Select Committee Chairman—there were 121 grants, the highest number since the scheme began and a three-fold increase on the same quarter of the previous year.
That the scheme has been subject to litigation is not surprising: it is a new regime, so litigants will seek to test its limits, particularly given the professional sector we are talking about. Having said that, we will listen to the concerns of the courts and address them where necessary—for example, by updating guidance or amending regulations to reflect the detail of the latest case law. My hon. Friend the Chair of the Select Committee made a point about the complexity of the forms; we are looking at that and will see whether we can simplify how they are presented.
Litigants in person are not a new feature of our justice system. People involved in litigation are engaged in a range of disputes and have a range of different needs and capabilities. For many people, representing themselves might be the right choice, whether because they literally want their day in court, physically; because of financial considerations; or because of the nature of the case. Litigants in person have always been a feature of the family justice system. Family court judges are well practised and rather good at stretching and striving to find the right kind of support and to allow flexibility so that litigants in person can give the best evidence possible.
I am not saying that we should disregard the impact of the reforms on litigants in person. In anticipation of an increase in numbers, right at the outset we put in place £370,000 of extra support for organisations, including new guidance. We have kept that under review and, where there have been concerns, we have taken further action, which is why we announced £2 million of further support for litigants in person in October last year.
Karl Turner
Is the Minister suggesting that the significant increase in litigants in person is based purely on the choice of the litigant, rather than the fact that they are just not in the position to access a lawyer, whether because of an advice desert in the area where they need advice or for other reasons?
Mr Raab
No. As the Chair of the Select Committee pointed out, we are talking about behavioural conduct—human beings in very difficult situations. Sometimes their lives might be chaotic or difficult, or they might be under pressing conditions. I am not sure that we can say precisely why it has happened, because there could be a variety of reasons. The fact is that there is now a new litigants in person support strategy in place, led by the advice, voluntary and pro bono sector, which builds on domestic and international advice and evidence. Progress has been made, with increased provision of face-to-face, phone and online support.
It is not right to claim that increasing numbers of litigants in person have created knock-on costs that undermine savings from legal aid reform. The National Audit Office looked at the matter very closely and reported that the additional costs of the changes are relatively small compared with the gross figures—we are looking at around £3.4 million a year, compared with the scale of the civil and family legal aid savings achieved, which the NAO estimated at around £300 million a year. The suggestion about knock-on costs is therefore just not right.
Encouraging greater use of mediation has been a key plank of our wider reforms to the justice system, and it is germane here. Mediation can a be quicker, cheaper and less stressful means of dispute settlement than protracted litigation. It is right that we try to keep a whole range of disputes outside of the courts. As I said earlier, the justice system is there for citizens, not just lawyers. Mediation also plays a role in reducing conflict and helping the parties to communicate better with each other.
Admittedly, the volume of individuals diverted from court into family mediation was not as expected following the reforms, but family relations are difficult to predict, particularly on a societal scale. Nevertheless, we acted quickly to address matters when it became clear that the behavioural shift was not being achieved to the degree that had been hoped for and estimated, although it was only an estimate. The Family Mediation Task Force was established in January 2014 to respond to the situation, and we accepted many of its recommendations.
Robert Neill
I understand the point the Minister is making, but, perhaps precisely because it is difficult to predict these things, would he accept that it is not realistic to wait three to five years for a review? Would he be prepared to review the situation in this coming year, in light of that very unpredictability?
Mr Raab
I say to my hon. Friend that, in fairness, it can be argued both ways. One could argue that we ought to have a look now because of some fluidity in the figures, or one could say, “Hold on, shall we see if it settles down and we get a slightly bigger picture? Otherwise we’ll only end up having a second review or implementing reforms based on an initial review without having the big picture.”
Robert Neill
Again, I understand what the Minister says, but will he also bear in mind that there is not only the issue of the unpredictability that is acknowledged on all sides, but the fact that there is a significant underspend? If there is a significant underspend, which is quantifiable, that tends to indicate fairly strongly that some cases that should be getting legal aid are not, even on the estimates that were made.
Mr Raab
That is a fair point, but I am not sure whether that alone would justify bringing forward the review. We want to gauge the long-term direction of the reforms, but I take on board my hon. Friend’s point, which he made perfectly reasonably.
The actions taken as a result of the Family Mediation Task Force’s recommendations include the mediation information and assessment meeting and the first session of mediation for both participants, where one participant is eligible for legal aid. The number of publicly funded mediation starts have now increased for five consecutive quarters and are at their highest volume since the quarter April to June 2013. We acknowledge that the volumes are not where we would like them to be, but we are working on it. While the figures bed down and we tweak the system, we acknowledge that it has not been perfect or particularly easy to estimate with any great precision, but we are seeing significant and substantial improvements. Given the trajectory we are now seeing, it is not right to rubbish this aspect of the reforms.
We have also worked to increase awareness of legal aid and the Civil Legal Advice service on the Government web pages. There is a new, enhanced “Check if you can get legal aid” digital tool available, which provides interactive information to help individuals to assess their eligibility for legal aid. The service has been designed and tailored around the needs of applicants following extensive user testing—it has not just been put up there on a whim. A new communications strategy will be launched this autumn to increase the awareness of our partners, stakeholders and their front-line advice providers, on the availability of legal aid and the Civil Legal Advice service through the new digital tool.
Domestic violence is undoubtedly one of the most important dimensions of the reforms and their impact. I assume it goes without saying that domestic violence and abuse appals everyone present, as well as everyone across the House and across society. That is why it is a priority for the Government, and why we retained legal aid for protective injunctions, such as non-molestation orders. On top of that, in private family law matters—cases concerning child arrangements and financial matters—funding might be available for those who would be disadvantaged by facing their abuser in court. That is an important innovation.
Of course, evidence is required to ensure that the correct cases attract funding, but we have listened to and responded to specific concerns. Following an early review of the system, we made changes to make evidence easier to obtain. Since we intervened, the number of grants in such cases has risen quarter on quarter and by 25% over the past year. We will keep that under review and we will keep responding to the evidence, because that is the responsible thing to do.
I would like to touch briefly on the proposed residence test, which is also important. It is also the subject of litigation that is before the Court of Appeal today, I think, so I cannot comment on the detail. Nevertheless, I want to make it clear that the Government believe, as a matter of principle, that individuals should have a strong connection to this country in order to benefit from our civil legal aid scheme. We believe that the test we have proposed—with important exceptions for vulnerable groups—amounts to an approach that is fair and appropriate.
I want to pick up on some of the points that were made in the previous speeches. The Chair of the Select Committee referred to the estimates of the spend; we need to be honest that they were estimates. The scheme is demand-led, so it is difficult to make estimations with great precision, but, when needed, legal advice will be available. We will be conducting a post-implementation review. He may argue that it should take place sooner rather than later, but there are arguments both ways. We should not have a review too quickly before the reforms bed down; otherwise, we risk not seeing what the full impact and implications are, and we will get only a partial view.
Alex Chalk
Does the Minister agree, however, that the other relevant consideration is that the longer we leave it, the more scope there is for some people who should have access to legal aid to be denied it? That can have significant implications for those individuals. That is one of the competing considerations to bear in mind.
Mr Raab
My hon. Friend is absolutely right, and he makes the point fairly. As policy makers we always face that issue, but I am not entirely convinced—the Minister responsible for legal aid will have to think about this and come to a conclusion—that the balance of argument is in favour of risking a rushed review. We should wait and see how the reforms bed down. The Minister responsible for legal aid may take a different view, but I am sure he will give the matter careful consideration, as I have today.
I want to raise two or three other issues in the time available. First, McKenzie friends were rightly raised; they are an important issue. We will consider the report and the updated guidance from the judiciary once we have got it. The right thing to do is to wait until we have got the expert advice from the judiciary before we come to a conclusion.
Other questions were asked about domestic violence and why the rules are not subject to greater discretion. That is a perfectly legitimate issue to raise, but we need objective evidence to apply the rules in a way that maintains the basic integrity of the system. We can have a debate about some of the detail of it, but that is an important point to note. I want to emphasise that the two-year time limit relates to the evidence of the abuse, not the abuse itself. I think there has been some misunderstanding about that important distinction.
I hoped that the Labour party would take a slightly more consensual approach, because in 2011 the then shadow Justice Secretary, the right hon. Member for Tooting (Sadiq Khan), told MPs that the legal aid budget is unsustainable. He said:
“We’ve got to be honest with the British public. When Labour left office, the legal aid budget was £2.1bn out of an overall MoJ budget of £8.5bn. That’s a lot of money. If you want to make savings you can’t cut courts, you can’t close prisons, you can’t cut probation, so the point that I make and I still make is: there are savings to be made.”
He was absolutely right, and if the shadow Minister disagrees he needs to explain where the extra money is going to come from. Punting it into review and saying they are going to pay for this thing by getting the Bank of England to print extra money—an idea that has been panned by the Governor as not only economically irresponsible but likely to hurt the most vulnerable in society, including the elderly and the poorest—will not do in a serious debate. We need credible contributions like the one today.
Karl Turner
Listen, the point is this. My right hon. Friend the Member for Tooting (Sadiq Khan) made those comments in 2011. The reality is that the Opposition criticised the changes in the Legal Aid, Sentencing and Punishment of Offenders Act 2012 throughout all stages of its passage through the Commons. Indeed, many changes were made in the Lords. The point is that the Select Committee is criticising the Act now. It is an objective criticism, and in truth the Chair criticised it more than I did.
Mr Raab
Well, we will wait for that, just as we are waiting for proposals on a range of social policy areas. In fact, there seems to be very little policy that is not up for grabs and up for review.
We have made significant reforms to the legal aid scheme, and we believe they are sustainable. We do not say that they have been easy choices. The Legal Aid Agency undertakes regular capacity reviews of supply, which continue to show sufficient capacity in all categories of civil law in the majority of procurement areas. Where that is not the case—for example, where a provider has withdrawn from a contract—the agency has taken action to find alternative provision.
I recognise the strength of feeling on this subject and the importance that hon. Members from both sides of the House attach to it. The Ministry of Justice and the Legal Aid Agency routinely and closely monitor the operation of the legal aid scheme, taking action when issues or problems are identified. I have tried to set out as best I can the areas where we have already responded. We do not say that we got it right first time without glitches or problems in the implementation.
We have also committed to conduct a post-implementation review of our legal aid reforms within three to five years of implementation—in other words, by 2016 to 2018 at the latest. The precise timing and the form of the review will be guided by our assessment of the extent to which the reforms have reached a steady state, as I have already indicated, and by Government and wider stakeholder research and evidence on the impact of the reform. I appreciate that there is a perfectly proper debate to be had on the timing, but we want to wait for that evidence and research to come through.
I am grateful for the Select Committee’s report and its approach. I am grateful to hon. Members who have spoken in this debate. I appreciate the points made by the shadow Justice Minister, and I hope I have been able to address as many of the questions as possible. I am happy to follow up further afterwards if that is not the case.
Robert Neill
I am very grateful to the Minister for the careful and considered way in which he dealt with this debate, having picked up what under different circumstances we would call a late return. I understand the constraints, and, as I hope I made clear, I am certainly not against making savings within the system. I will take the Minister at his word when he says that there is a need for objective evidence. We will continue to press the Government, because that objective evidence needs to be quantified sooner rather than later. We need to look at the knock-on costs, which I do not think have been adequately taken into account.
I welcome the expert advice that has been taken on McKenzie friends. The Committee will want to press the Government for a timetable on that, but we need not do so today because it is a small, simple and relatively cost-neutral change to the system, which will be of benefit. I hope that, given that the Minister accepts the need for objective evidence, he recognises that that must also apply to a quantification of the impacts, which we have not seen. We must deal with why the underspend arises at the level it does. That is the fundamental issue we raised, and it has still not been fully addressed.
I am grateful for the Minister’s response, but the Select Committee will inevitably need to return to this issue. It is important to understand why there is an underspend so that we can ensure that the proper advice and support gets to the people who need it, which is an objective that I know Members on both sides of the House share.
Question put and agreed to.
Resolved,
That this House has considered the Eighth Report from the Justice Committee, Session 2014-15, on impact of changes to civil legal aid under part 1 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012, HC 311, and the Government Response, CM 9096.
Written Statements
(8 years, 6 months ago)
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Pricing Practices (Groceries Market)
(8 years, 6 months ago)
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The Minister for Skills (Nick Boles)
On behalf of the Government, I am today announcing that we have published a response to the Competition and Markets Authority (CMA) welcoming its report and recommendations in respect of the super-complaint made by Which? alleging pricing malpractice in the groceries market.
The Government are pleased to see the CMA does not consider there to be a systemic problem in the grocery market in how retailers present prices. We also welcome CMA’s plans to take action where it has identified examples of potentially misleading and confusing practices. The CMA did find however that more could be done to reduce the complexity in unit pricing to make it a more useful comparison tool for consumers.
Addressing the recommendation concerning price promotions and special offers the Chartered Trading Standards Institute is today publishing its consultation on a revised pricing practices guide. BIS will consult later in the autumn on proposals to simplify and improve unit pricing to help the consumer compare prices more easily across similar products and therefore identify the best deals. We will continue to work closely with Which? CTSI, retailers and supermarkets, including through the BIS expert working group, and welcome continued input from the CMA.
[HCWS240]
UK Green Investment Bank
(8 years, 6 months ago)
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The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid)
My written statement of 25 June provided an update on work to move UK Green Investment Bank plc (GIB) into private ownership. It was always our intention that GIB should mobilise maximum private investment in the green economy. This reflects our policy aim of getting the market to work in tackling green policy challenges.
Bringing private ownership directly into GIB is part of this aim and a natural next step for the company now it has proved itself a successful commercial enterprise capable of operating with private sector capital rather than relying on public funding for its investments. It will allow the bank to access a much greater volume of capital than would be the case if GIB were to remain in Government ownership meaning it can grow its business, move into a wider range of sectors and have the greatest possible impact in mobilising investment so that more green projects get financed more quickly than would otherwise be the case. The plans have the full support of the company and its independent board, including chair, Lord Smith of Kelvin.
As I said in my previous statement, a key objective in moving the company into the private sector is that it should be free to borrow and raise capital without this affecting public sector net debt. Giving GIB this freedom is essential if the company is to invest in accordance with its ambitious green business plan.
It is now clear that to achieve re-classification of GIB as a private sector enterprise, we need to remove the public sector controls imposed on the company by the Enterprise and Regulatory Reform Act 2013. Unless we remove these controls, there is a real risk GIB would remain classified to the public sector even after a sale so would remain subject to Government control over its capital raising. This unintended effect of the legislation has only become apparent in the course of our work to facilitate GIB’s transition into the private sector.
In view of this, as a necessary part of the privatisation process, we now propose to use the Enterprise Bill, through an amendment shortly to be tabled at the Lords Committee stage, to repeal the relevant sections of the Enterprise and Regulatory Reform Act 2013 relating to GIB.
I recognise that in taking this step, people will wish to be assured GIB will nevertheless continue to invest in green sectors as Parliament envisaged. I wish to make clear that the Government also want and expect a privately owned GIB to continue this clear focus on green sectors—mobilising more private capital and further accelerating the transition to a green economy.
It is clear from preliminary feedback that potential investors are interested in acquiring a stake in GIB precisely because of its unique green specialism and its green- focused business plan. As part of any sale process, we would expect potential investors to confirm their commitment to GIB’s green values and to set out how they propose to ensure these are protected.
I will provide further updates about the transaction as soon as possible.
[HCWS239]
UK Bilateral Loan to Ireland
(8 years, 6 months ago)
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The Financial Secretary to the Treasury (Mr David Gauke)
HM Treasury has today provided a further report to Parliament in relation to the bilateral loan to Ireland as required under the Loans to Ireland Act 2010. The report relates to the period from 1 April 2015 to 30 September 2015.
A written ministerial statement on the previous statutory report regarding the loan to Ireland was issued to Parliament on 15 June 2015, Official Report, column 1WS.
[HCWS247]
Money Laundering and Terrorist Financing (Risk Assessment)
(8 years, 6 months ago)
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The Economic Secretary to the Treasury (Harriett Baldwin)
Money laundering can undermine the integrity and stability of our financial markets and institutions. Countering terrorist financing is also important in protecting national security and forms a key part of the UK’s counter-terrorism strategy.
Money laundering is a global problem and the laundering of proceeds of overseas corruption into or through the UK fuels political instability in some countries. The European Commission’s 2013 impact assessment of anti-money laundering and terrorist financing points to global criminal proceeds potentially amounting to some 3.6% of global GDP; around US$2.1 trillion in 2009.
The Government have already taken steps to improve the anti-money laundering and counter-terrorist financing regimes including by:
launching the Economic Crime Command in the National Crime Agency in 2013;
publishing the UK anti-corruption plan in 2014 and setting up a new specialist international corruption unit in the NCA;
strengthening the confiscation regime under the Proceeds of Crime Act 2002 and creating a new offence for participation in organised crime;
introducing a reporting process for anti-money laundering (AML)/counter-financing of terrorism (CFT) supervisors, improving the transparency and accountability of supervision and enforcement in the UK;
building asset confiscation enforcement (ACE) teams to crack down on those who refuse to pay their confiscation orders, contributing to the recovery of £199 million last year, the highest amount on record;
forming a new partnership with the financial sector to create the joint money laundering intelligence taskforce;
and launching a review of the suspicious activity reports (SARs) regime.
Today, the Government are publishing the UK’s first national risk assessment of money laundering and terrorist financing. It identifies and assesses the UK’s money laundering and terrorist financing risks, drawing on data from UK law enforcement and intelligence agencies, anti-money laundering supervisors, Government Departments, industry bodies and private sector firms.
The national risk assessment has found that while the UK’s response to money laundering and terrorist financing risks is well developed, more could be done to strengthen the UK’s anti-money laundering and counter-terrorist financing regime, including in the following areas:
the understanding of certain types of money laundering, and particularly in relation to “high end” money laundering, where the proceeds are often held in bank accounts, real estate or other investments, rather than cash;
the consistency of the UK’s supervisory regime, and specifically the understanding and application of a risk-based approach to supervision;
the priority given to combatting money laundering by law enforcement agencies and the effectiveness of their response.
The Government will take forward these findings in a comprehensive action plan. The priorities for the action plan will include:
fill intelligence gaps, particularly those associated with “high end” money laundering through the professional services sector;
enhance our law enforcement response and build more effective public-private sector partnerships, to tackle the most serious threats;
address the inconsistencies in the supervisory regime that have been identified;
work with supervisors to improve individuals’ and firms’ knowledge of money laundering and terrorist financing risks;
increase collaboration between law enforcement agencies, supervisors and the private sector to support prevention and detection.
The Government are committed to ensuring that the anti-money laundering regime is effective and proportionate, with businesses and regulators taking a risk-based approach to implementation. The Better Regulation Executive is leading a “red tape” review into the UK anti-money laundering regime to identify for example where companies are confused as to what is required or are undertaking unnecessary activity which diverts attention away from where there are real risks. The results of this review will inform the action plan.
The UK is periodically assessed under mutual evaluations by the Financial Action Task Force. The national risk assessment and the action plan will be kept under review and will inform the UK’s next evaluation.
A copy of the report has been deposited in the Libraries of both Houses.
[HCWS244]
TV Licence Fee Enforcement Review Report
(8 years, 6 months ago)
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The Secretary of State for Culture, Media and Sport (Mr John Whittingdale)
On 16 July 2015, the TV licence fee enforcement review, independently led on behalf of the Government by David Perry QC, was published and laid before Parliament.
In accordance with section 77(3) of the Deregulation Act 2015, I am now pleased to present a short report setting out my response to the review, and its recommendations.
The review has provided a fundamental contribution to the debate on the future of the TV licence fee enforcement regime, and I can confirm that the issues highlighted, and the recommendations made, will be considered in further detail during the forthcoming charter review.
As this report will play a central role in the debate, I do not propose to make regulations under section 78(1)(a) or (b) of the Deregulation Act 2015 at this time. This will be kept under review throughout the charter review and I will make a statement to the House taking a firm decision in due course as part of that process.
A copy of the report has been deposited in the Libraries of both Houses. Attachments can be viewed online at: http://www.parliament.uk/writtenstatements.
[HCWS246]
Service Museums
(8 years, 6 months ago)
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The Parliamentary Under-Secretary of State for Defence (Mark Lancaster)
My right hon. Friend the Minister of State in the House of Lords, Earl Howe, has made the following written ministerial statement.
I am today announcing the start of a comprehensive review of the three service museums; the National Army Museum, RAF Museum and National Museum of the Royal Navy, all of which are executive non-departmental public bodies (ENDPB) of the Ministry of Defence. In this capacity, the service museums provide independent advice to the Secretary of State for Defence on the promotion and management of armed forces heritage matters.
This review is part of the Government’s commitment to ensuring, and improving, the accountability and effectiveness of public bodies on a regular basis. The review will be conducted in accordance with Government guidance for reviewing ENDPBs, and will focus on the core questions of the continuing need for the functions of the ENDPBs, their effectiveness and their governance arrangements. It will be carried out in an open and transparent way, and stakeholders will be given the opportunity to contribute their views.
I will inform the House of the outcome of the review when it is completed.
[HCWS248]
School Expansion
(8 years, 6 months ago)
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The Secretary of State for Education (Nicky Morgan)
I have today written to the headteacher at the Weald of Kent Grammar School in Tonbridge, Kent, to confirm that I have approved their proposal to expand on to a new site in Sevenoaks, Kent.
It is this Government’s policy that all good and outstanding schools should be able to expand to offer excellent places to local students. The Weald of Kent Grammar School is one of the top performing schools in the country, with 99% of its students achieving five A* to C grades in GCSE exams in 2014, and 98% of sixth form students achieving at least three A-Levels at grades A* to E.
The Weald of Kent Grammar School submitted a proposal for expansion in 2013. At that stage the then Secretary of State could not approve the proposal as an expansion because the proposal at that time was for a mixed-sex annexe when the existing school was single sex. The school submitted a revised proposal in September 2015 under which girls will be educated on both sites alongside a mixed-sex sixth form. I am satisfied that this proposal represents a genuine expansion of the existing school, and that there will be integration between the two sites in terms of leadership, management, governance, admissions and curriculum. I am also satisfied that the excellent quality of learning currently delivered will be replicated across the newly expanded school. I welcome the fact that the newly expanded school will better meet the needs of parents in the local area, with 41% of existing pupils at the Weald of Kent Grammar School already travelling from the Sevenoaks area.
The school expects to be able to start educating pupils at its new Sevenoaks site from September 2017.
My decision in this case has been taken on the basis of the proposal from the Weald of Kent, in line with legislation and criteria determining what constitutes an expansion. It does not reflect a change in this Government’s position on selective schools. Rather it reaffirms our view that all good schools should be able to expand, a policy which is vital to meet the significant increase in demand for pupil places in coming years. Further applications from good selective schools to expand will continue to be considered within the framework of the statutory prohibition on new selective schools and would have to meet the criteria for being a genuine expansion.
[HCWS242]
Justice and Home Affairs Council
(8 years, 6 months ago)
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The Secretary of State for the Home Department (Mrs Theresa May)
First I would like to send my apologies that a pre-Council letter was not sent ahead of the Council on this occasion. This is a rare occurrence owing to a combination of late finalisation of the agenda for Council, and conference recess.
The Justice and Home Affairs (JHA) Council took place on 8 and 9 October in Luxembourg. My right hon. Friend, the Secretary of State for Justice, Lord Ahmad of Wimbledon and I attended on behalf of the United Kingdom. The following items were discussed.
The interior session on 8 October began in mixed Committee with Norway, Iceland, Liechtenstein and Switzerland (non-EU Schengen states) where the presidency provided an overview of their paper on the future management of the EU external border. The subsequent discussion saw calls for enhanced collective responsibility for the external borders, including some support for the Commission’s calls for a fully-fledged EU border and coast guard and an extended mandate for Frontex, although the presidency was clear that member states must retain primary responsibility for controlling their own border. The Commission also drew attention to the role of EU smart borders and the Schengen information system in balancing border management and security, and the need for further consideration on whether more was needed to ensure the proper functioning of the Schengen acquis. The October European Council will return to this subject.
There was also an update on the relocation mechanisms agreed at the 14 and 22 September extraordinary JHA Councils, and the implementation of the ‘hot spots’ screening centres in Italy and Greece, with calls for all member states to provide Frontex and the European Asylum Support Office (EASO) with additional personnel and resources. There had been some progress, with implementation underway in Italy and starting in the Greek islands imminently, but it was clear more work was required, including on the return of those not requiring protection. Concerns were also raised regarding the likely effectiveness of intra-EU relocation and further secondary movement. Discussions on an agreed list of safe countries of origin and a permanent crisis mechanism for relocation (amending the Dublin regulation) would continue at official level.
The UK was clear that the current situation required a new international approach- strict enforcement of rules was required for those who abuse member states’ asylum and migration systems but we should be generous to those who needed our help. Economic migrants needed to be returned swiftly, including from hotspots, so that the right messages were received by those intending to set out for Europe. The UK would continue to support EASO and Frontex and will offer additional assistance, building on the offer already made this summer. I also made it clear that the UK would be willing to use its expertise in helping Greece set up the necessary systems and structures.
Returns were the subject of a separate debate, with the Commission introducing an EU action plan on returns, Council conclusions on the future of EU returns policy and a returns handbook, and stating that by the end of October there would be 10 joint EU return flights to African and Western Balkan countries. An EU returns office will be established within Frontex to co-ordinate all returns action and better use will be made of existing tools such as SIS and EURODAC databases. The main challenge remained countries of origin not accepting their nationals back, despite recognised international obligations for them to do so, leading for calls for greater use of conditionality in broader relations with key third countries.
The UK reiterated the importance of returning those not requiring international protection, in order that help could be focused on those in greatest need, which meant that effective returns of those not requiring international protection in Europe was vital. Identifying safe countries of origin was welcome, but the EU needed to go further.
I, also suggested that considering claims from certain countries as inadmissible except in exceptional circumstances could be the next step in tackling abuse, and that the use of detention was also necessary. The UK argued that it was important to consider seeking leverage with third countries to secure co-operation, that detention was often necessary and that the EU should take forward discussions on multi-purpose centres and safe zones outside of Europe to which economic migrants could be returned. I expressed the Government’s support for improved returns mechanisms, in particular at the EU external border and noted that the UK will carefully consider all current and future proposals.
The presidency sought a steer from Ministers on its proposals to unlock discussion on the “visa package”—a recast of the union code on visas (“the visa code”) and proposed touring visa. The Commission and member states had been deeply divided on the proposals. There is no impact for the UK as we are not involved in either of these measures because they build on those parts of the Schengen acquis in which we do not participate. Ministers endorsed the presidency’s proposals for continuing discussions at official level.
The lunchtime discussion was on migration and development. Following a briefing by Luxembourg’s Development Minister, interventions veered to familiar ground on hotspots and relocation. The UK supports the hotspot proposals and continues to push for their rapid implementation, but we continue to oppose relocation.
The Europol Director (Rob Wainwright) updated Ministers on the recent Blue Amber operation, a series of joint operational action weeks co-ordinated through an operations room at Europol. The presidency concluded that the Committee on Internal Security (COSI) would continue to prioritise serious organised crime under the EMPACT priorities.
During a discussion on the fight against terrorism, the council adopted conclusions calling for an improved firearms intelligence picture and robust standards on firearms deactivation. The UK supports the Council’s position and has urged member states to prioritise the actions set out in the Council conclusions. The Commission is undertaking a study into further proportionate measures that can ensure greater passenger security. The UK called for the sharing of best practice in relation to rail security.
The Council agreed to step up the voluntary removal of terrorist propaganda through the Europol Internet Referral Unit (IRU). The UK welcomed the results achieved by the IRU so far and supported the upscaling of the programme, calling on more member states to second national experts to the unit. The Council agreed to enhance counter narrative work with the Syria strategic communication advisory team (SSCAT)’s support. The Government welcome the SSCAT 2016 project as a tool to support member states to improve their capacity to deliver strategic communications campaigns to counter the influence of violent extremists.
The presidency updated Minsters on the implementation of the renewed internal security strategy 2015-2020. The presidency had set the following priority areas for implementation under their tenure 1) fight against terrorism 2) tackling illegal migration 3) completion of the Europol regulation 4) completion of the EU PNR directive. The following presidency trios were encouraged to continue with a six monthly implementation plan, but also to establish an 18 month joint implementation strategy to retain continuity over the medium term.
The presidency updated on progress on the Europol and passenger name records (PNR) trilogue negotiations. Both the presidency and the Commission urged member states to continue lobbying their national Members of Parliaments to ensure they fully understand the value of PNR. I reiterated the need for intra EU data to be included for any directive to be effective.
Justice day started with a ministerial breakfast meeting on the implications of the Taricco judgment in relation to the draft directive for the protection of the union’s financial interests. There was broad agreement to retain the title V legal base and the UK, supported by other member states continued to oppose the inclusion of VAT fraud in the directive protecting our red line.
The presidency reiterated its aim to complete negotiations on both the general data protection regulation and the accompanying law-enforcement focused directive by the end of the year. With a general approach on the regulation secured in June, the presidency presented a compromise text on the directive and sought approval from Ministers to enter trilogue negotiations with the European Parliament as soon as possible. The Commission welcomed the text, noting the delicate balance that had been achieved between operational effectiveness and privacy for data subjects, and the need to create a level playing field across the EU, for all forms of data processing.
The UK welcomed the changes made during expert discussions and urged the presidency to defend the Council position during trilogue, particularly the ability of law enforcement agencies to withhold information where appropriate for operational reasons, and to transfer data to third countries. Most other member states agreed and considered the draft to be a good balance between the rights of data subjects and needs of law enforcement agencies. The general approach was agreed.
The Commission updated Ministers on the recent decision by the Court of Justice of the European Union (CJEU) to strike down the EU-US “safe harbour” agreement, which established a framework for the transfer of data from the EU to the US. In its view, the ruling was a clear statement on the importance of data protection as a fundamental right, and validated the Commission’s to review the safe harbour agreement. The Commission acknowledged however, that the invalidation of safe harbour would require data controllers to rely on other legal grounds for the transfer of data to the US, such as contractual clauses, binding corporate rules, or consent. The Commission assured member states it wanted to see uniform application of the ruling, and expected that national data protection authorities would provide consolidated advice to business through the article 29 working party.
The Commission reiterated the need to work with the US on a revision of the safe harbour agreement. It noted that negotiations on a revised framework had been ongoing for almost two years. The Commission felt that the ruling would ensure greater clarity about the safeguards that a revised agreement would need to provide.
The presidency sought Council agreement to certain articles of the proposed regulation establishing a European Public Prosecutors Office (EPPO). The Council expressed provisional agreement. The UK does not participate in the EPPO. We noted our non-participation and registered our strong interest in ensuring that the scope of any EPPO does not go beyond the treaties.
During lunch, the presidency presented a progress report on the work of the EU accession to the European Convention of Human Rights and a summary of the problems with the draft accession agreement identified by the CJEU in its opinion of December 2014. There was some support for the presidency’s proposal that the EU reaffirm its commitment to the accession process. The UK, along with the Council legal service, highlighted the profound challenge presented by the Court’s opinion. The discussion concluded with the Commission recognising the difficulties faced, but agreeing to provide technical papers to assist the Council in identifying solutions to the issues raised by the CJEU.
Ministers discussed the migration situation, and the particular challenges it raises for judicial cooperation and tackling xenophobia. This included the role Eurojust might play in supporting member states in tackling these issues.
Additionally, there was a general discussion in response to the immigration crisis and best practice in co-operation between Governments and internet service providers to tackle hate speech online.
Under AOB, the Commission reminded member states that the victims’ rights directive would be coming into force on 16 November 2015. The UK is committed to transposing the victims’ rights directive by the deadline.
[HCWS249]
HM Courts and Tribunal Service
(8 years, 6 months ago)
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The Parliamentary Under-Secretary of State for Justice (Mr Shailesh Vara)
In the last financial year HM Courts and Tribunals Service (HMCTS) collected over £550 million of fines, other financial impositions, fixed penalties and orders, and that money has helped to fund vital services for taxpayers.
To build on this work, in July 2013 my Department began a procurement competition for a new provider of criminal court compliance and enforcement services, and a preferred bidder was identified in January 2015.
Following reconsideration of the Department’s requirements, we have decided that outsourcing these services to a single supplier is not the best option for HM Courts and Tribunals Service. This decision is based on the need to ensure that any contract we let completely meets our requirements, provides best value for the taxpayer and complies with procurement law.
Ministers have set out the importance of reforming HMCTS to provide a modern and efficient service for society. Improving compliance and enforcement services will continue to form a key part of that work. We believe that in-house modernisation is the best option for HMCTS.
[HCWS237]
Coroner Reforms
(8 years, 6 months ago)
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The Parliamentary Under-Secretary of State for Women and Equalities and Family Justice (Caroline Dinenage)
The Government are committed to making sure bereaved people are at the very heart of the coroner system.
I am therefore pleased to announce the launch of a post-implementation review of the coroner reforms in the Coroners and Justice Act 2009 (‘the 2009 Act’), which will include a call for evidence into people’s experiences of coroner services.
Before the last Government implemented the 2009 Act’s coroner reforms, in July 2013, it undertook to review their impact after they had been in place for 18 months.
Since assuming responsibility for coroner policy and legislation following the general election I have considered the appropriateness of this Government carrying out such a review.
The reforms have now been in place for just over two years and I believe that this is a good period of time against which to assess the impact of the reforms and seek views on people’s experiences of the system
The Government are keen to hear the views of:
The providers of local coroner services—coroners, their officers and other staff, and the local authorities that fund coroner services;
those who have used coroner services under the 2009 Act—bereaved people and the voluntary organisations, including faith groups, who support them;
others who interact with coroner services—such as pathologists, other doctors and registrars; and
others who have been affected by and have experiences of coroner services under the 2009 Act.
We will seek views for eight weeks, starting today. After that we will consider the responses we have received and publish a post-implementation review report. Any proposed action arising from the findings of the review will be announced at that time.
The review is available at: https://consult.justice.gov.uk.
[HCWS243]
EU Informal Transport
(8 years, 6 months ago)
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The Secretary of State for Transport (Mr Patrick McLoughlin)
I attended the first formal Transport Council meeting under the Luxembourg presidency (the presidency) on Thursday 8 October2015.
The Council unanimously agreed general approaches on two proposals which form the “market pillar” of the fourth railway package: the proposal amending directive 2012/34 establishing a single European railway area, and the proposal amending regulation (EC) No 1370/2007 concerning the opening of the market for domestic passenger transport services by rail. The general approach texts mandate competitive tendering for public service contracts as a rule, but with several derogations to allow for direct awards in certain circumstances. I welcomed the efforts of the presidency to progress the fourth railway package, and set out the great success of rail liberalisation in our domestic market. I thanked the presidency for the provision allowing directly awarded contracts in exceptional circumstances, but expressed my disappointment in the changes to the texts allowing these in wider cases. I put forward the view that this had limited the ambitions of the market pillar and would lessen competition. However, along with all other member states I recognised the positive steps towards liberalisation that had been made and in the spirit of compromise supported the general approach. The presidency expressed their ambition to engage swiftly in trilogue discussions with the European Parliament and conclude negotiations on the package.
The Council held a policy debate on the review of the Commission’s 2011 White Paper on Transport. I agreed that the objectives set in 2011 are still largely relevant and their importance in ensuring that transport remains a key driver for growth and the single market. I welcomed the Commission’s commitment to better regulation and REFIT, and emphasised the need for EU initiatives to be targeted, proportionate and effective. I also highlighted the opportunity and challenges that digitalisation poses for the EU.
Over lunch there was a debate on cross-border co-operation in rail security following the Thalys incident in August. I put forward my support for the exchange of best practice between member states and transport operators, rather than any legislative initiative.
The presidency provided an update on the European fund for strategic investments and the transport infrastructure investment opportunities available. Some member states made limited interventions to welcome the long-term investment opportunities and the ability to combine with other financing streams and one member state expressed opposition to the use of private investment in long-term infrastructure projects.
Under Any Other Business, the Commission provided an update on new emissions testing procedures and the state of play on the real driving emissions tests. The Commission reiterated the three main actions following the Volkswagen situation: investigations being carried out in member states, the real driving emissions proposal, and in the future revisions to type approval legislation. The Commission asked all member states to respond to proposals. Germany gave a comprehensive update on domestic action, and I along with other member states welcomed the Commission’s call for domestic investigations. I also expressed our support for the real driving emissions proposals and stressed that independent and accurate tests were key to restoring confidence among consumer and environmentalist groups.
Also under Any Other Business, the presidency provided an update on the outcome of the informal Transport Council on Wednesday 7 October and the declaration on cycling.
I was also able to hold bilateral discussions with my EU counterparts from Germany and the Czech Republic to discuss the VW emissions situation. I also met the Dutch Transport Secretary to discuss their preparation and priorities for the forthcoming Dutch presidency.
[HCWS238]
EU Transport Council
(8 years, 6 months ago)
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The Secretary of State for Transport (Mr Patrick McLoughlin)
The UK was represented at official level at the informal Transport Council held under the Luxembourg presidency (the presidency) on Wednesday 7 October 2015.
The theme of the informal Transport Council was cycling as a mode of transport. The main agenda item was the presidency’s proposal for a declaration of Ministers on cycling as a climate-friendly transport mode.
The declaration called upon the Commission to integrate cycling into multi-modal transport policy, develop an EU-level strategic document and set up a European focal point on cycling. It also set out some action points for member states which included, for example, the designation of a national focal point for cycling and for national transport infrastructure projects to focus on strengthening cycling networks.
The UK outlined the importance of cycling in the UK, and the range of economic and health benefits it brings. Support was offered for other member state views on establishing national and European focal points for exchanging best practice. The UK welcomed the fact that “road safety” and “smart mobility” were referenced, as addressing behavioural matters is a key aspect of encouraging people to cycle. The UK also highlighted the importance of respecting the principle of subsidiarity and the fact that cycling is a devolved matter and so is best managed on a national and regional level.
[HCWS241]
Priorities on Pensions
(8 years, 6 months ago)
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The Parliamentary Under-Secretary of State for Work and Pensions (Mr Shailesh Vara)
My noble Friend the Minister of State, Department for Work and Pensions (Baroness Altmann) has made the following written statement:
“The new state pension comes into payment from April 6 next year. This reform will bring much-needed clarity to a system that few people truly understand, and will reduce the need for pensioner means-testing. Alongside this, over 5.4 million employees have been enrolled into a workplace pension by around 60,000 employers, dramatically increasing the number of people saving for later life. However, they represent around only three per cent of employers as large and medium-sized firms were first to implement automatic enrolment.
The Government’s priorities are to carry through those important reforms to ensure they are a success. This means new state pension being delivered as smoothly as possible and small and micro employers getting the help and support they need as they meet their automatic enrolment duties.
Government and the pensions industry are also currently working through the changes following from the new pension flexibilities which allow scheme members to have more freedom and choice about how and when they withdraw their pension savings.
All these reforms will increase the number of people saving into workplace pensions, introduce new freedoms allowing savers to access their cash, and implement a new state pension that will be far easier to understand in the future. However, we are conscious of the need to ensure Government, providers, employers and members are able to focus on these changes to ensure their success.
That is why we have decided that the time is not right to implement defined ambition, collective benefits and automatic transfers. The time is not right to ask the pensions industry to absorb the new swathe of regulation that would be needed to make such further reforms work effectively. The market needs time and space to adjust to the other reforms underway and these areas will be revisited once there has been an opportunity for that to happen”.
[HCWS245]